Adam Smith was the founder of political economy and with his book 'Inquiry into the Nature and Causes of the Wealth of Nations' in 1776, he laid the foundations of liberal school. Moreover, Adam Smith was strongly influenced by French encyclopedists such as Diderot and D'Alembert and he joined the theory of the Physiocrats in defending the free movement of goods (as opposed to commercialism).
However, he opposed the Physiocrats by saying that the industry is the key driver of economic growth and not agriculture as declared by the Physiocrats. According to Adam Smith, wealth is born of the division of labor which is based on the nature of man. For the Scottish economist, from the time when individuals, groups, specialize, they become more competent while being dependent on each other; and thus manage to meet the needs of consumers and also production needs.
The division of labor is based on the nature of man according to Adam Smith, what he calls his natural inclination to trade. Specifically, men have an economic interest to be exchanged to acquire and consume goods. Therefore, the man will increase exchanges so as to increase its surplus of tradable markets.
This accumulation of wealth resulting from increased trade in the markets is also accompanied by a division of labor and this will lead to increase in the economic exchange, production and consumption of goods and services. From this perspective, the market is developing in conjunction with an increase in the division of labor, while allowing increased trade and market development. Through the example of the famous pin factory, Adam Smith seeks to highlight the tremendous productivity gains made by a technical division of fragmented labor. Thus, the same activity can be broken down according to Adam Smith in several separate tasks performed by a specified number of workers.
To explain the productivity gains made in the division of labor, Adam Smith gave three main reasons:
• first, the division of labor can therefore save time in the production process
• secondly, the division of labor increases the ability of the workers. In this sense, the skill will be born of repetition of the same act
• finally, the division of labor allows the introduction of machine that makes the worker more efficient. Historically, the development of machines in businesses due to both the development of technical research (those allowed by Smith called scholars and theorists) and by the performance of the industry chose to introduce the machines in the production process.
Tags: political economy, commercialism, Adam Smith, economic interest
[...] Conclusion In conclusion, since the design of the division of work was developed by Adam Smith, put into perspective by Emile Durkheim and Alexis de Tocqueville criticized by Karl Marx, the concept of division of labor has undergone numerous reforms and applications (Taylorism, Fordism, and Toyotism). We see a new turn today with the introduction of NTIC (New Technologies of Information and Communication) from the 1990s. Indicative bibliography proposed by Oboulo.com The Essential Adam Smith by Adam Smith, Robert L. Heilbroner, and Laurence J. Malone Adam Smith Inquiry into the Nature and Causes of the Wealth of Nations edition used. Karl Marx Capital . Emile Durkheim The Division of Labour in Society . [...]
[...] Thus, the laboring poor, devoted to the repetition of tasks, is "stupid and ignorant, and can ultimately participate in the great affairs of his country." Recognizing this, Adam Smith suggested the need to develop the division of labor, but opined that political leaders must take appropriate "precautions", namely to develop training in schools and introduce younger generations to political participation. In effect Adam Smith enhanced the role of education. III. Development and extension of the division of labor A. Major evolutions 1. Taylorism Taylor follows the same objective as Adam Smith, namely: improving productivity. He fights against the tendency of workers and unions to systematically slow the production process, and to increase yields which will provide the social organization of work, based on two essential principles. [...]
[...] The benefits of the division of labor Through the example of the famous pin factory, Adam Smith seeks to highlight the tremendous gain in productivity made possible by a technical and fragmented division of labor. Thus, according to Adam Smith, an activity may be broken down into several distinctive tasks performed by a specified number of workers. To explain the productivity gain made possible by the division of labor, Adam Smith gives three main reasons: • Firstly, division of labor saves time resulting in the shortening of the production process • Secondly, division of labor increases the ability of workers. [...]
[...] • Firstly, the horizontal division of labor (the division of tasks), i.e. the decomposition of output into several simple operations to perform on a measurable period. • Secondly, the vertical division of labor refers to the principle of separation between performance and design; it is the specialization in the company within the "office of the methods." 2. Fordism Henry Ford proposes and defends the idea of a new application of Taylorism by highlighting three key elements: • Firstly, the line of work must be accompanied by an increase in wages ("five dollar a day"). [...]
[...] The contemporary extensions 1. Division of labor within corporate networks On the one hand, we witness the disappearance of big businesses that are traditionally organized, leaving room for a new technical and social division of labor, originating from and initiated by companies in Japan. Secondly, there is the disintegration of the organizational model of vertical and functional bureaucracies, which are replaced by horizontal rather than hierarchical bureaucracy based on the enhancement of capacities of all actors in the production process. [...]
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