In the News Teaching Activity: Division of Labour in Modern Times (Sept 2023)

The Economics Observatory takes a look at how Adam Smith’s division of labour applies in the modern world. Have a go at this free teaching activity, which includes a downloadable worksheet and suggested answers.

These days it seems that many final goods ready for consumption are the end result of complex supply chains involving multiple companies and various stages of production. Rather than each worker taking on a different task along the production line, it seems it is increasingly likely that each individual company takes on a specialist role that concentrates on one aspect of a supply chain. Does this mean Smith’s concept has no value any more or has the nature of its application to the real world simply changed?

The hollow corporation: what does today’s division of labour look like? (Economics Observatory)

Read the article and then answer the following questions.

1. What is meant by the division of labour?
2. What are the advantages and disadvantages of the division of labour?
3. Given the arguments in the Economics Observatory article, discuss whether the applications of the division of labour have changed over time.