Division of Labour (3) - Cities

The division of labour makes life in cities possible. Without the benefits of specialisation and trade, life in a modern city would be impossible, even for those who live simply. Several companies in the city where I live produce top quality electronic equipment that is exported all over the world. However, this city does not have the capital equipment are the range of skills needed to manufacture the full range stuff that people need to survive in a modern city. The only way that we can maintain a city lifestyle is to specialise in manufacturing and exporting a very limited range of products and import the other goods and services that we need.

What is true for a city is also true for a large country. Even the United States does not have sufficient capital and skills to produce the full range of goods and services needed to sustain life in and American city. If America attempted to be self sufficient, living standards would suffer as the benefits of the division of labour and specialisation disappeared. Life in the city would be terrible.

Self-sufficiency is not a practical for a city or country, but it is even less practical for an individual. An individual who attempts to be self-sufficient loses all the benefits that have come through trade and the division of labour. A man fending for himself will be hard pressed to produce enough food and clothing for his own family, even if he was very industrious. He will not have time to produce all the things that we need to live in a city.

In difficult economic times, trade declines. A reduction in the division of labour and a decline in living standards inevitably follow. We will have to deal with this, if it happens, but we must understand that a total collapse of trade and return to total self sufficiency would be a total disaster for people living in a modern city.

A collapse of trade would severely damage the lifestyles of people living in the country. Most country people in the Western world are dependent on the division of labour and lack the skills and equipment needed to be self-sufficient.

People in some parts of the world may be forced into subsistence and self sufficiency, but that should never be our first response to crisis. Whatever our circumstances, we should always attempt to specialise and trade as much as is practicable. We should always maintain as much division of labour as possible. Being dependent on other people will strengthen our community and enlarge our lifestyles.

Tomorrow, I will start thinking about preparaton for crisis.

Division of Labour (2)

The name that economists use for this specialisation and trade is the “division of labour”.

Division of labour or specialization is the specialization of cooperative labour in specific, circumscribed tasks and roles, intended to increase the productivity of labour (Wikipedia).

By increasing the productivity of labour, supports trade and improves the standard of living in a society.

The division of labour is really important, because even a small decline in the division of labour will make most people will be worse off. The reality is that no Western country can make all the products that modern people are used to consuming. When specialisation and trade diminish, standards of living decline.

The division of labour and specialisation is a Christian way of functioning.

Just as each of us has one body with many members, and these members do not all have the same function, so in Christ we who are many form one body, and each member belongs to all the others. We have different gifts, according to the grace given us (Rom 12:4-6).

There are different kinds of gifts, but the same Spirit. There are different kinds of service, but the same Lord. There are different kinds of working, but the same God works all of them in all men (1 Cor 12:4-6).

The church functions best when the prophets prophesy, the apostles apostle, the pastors, pastor, the evangelists evangelise, the servers serve and the encouragers encourage. When each Christian tries to do a little bit of everything, the body of Christian is weakened.

Division of Labour (1)

In the next couple of days, I will be posting some suggestions about how to prepare for a crisis. To understand some of the issues I raise, readers will need to understand the role of the Division of Labour in economic activity. I will explain the meaning of this expression in my next two posts before going on to talk about preparation.

Specialisation and Subsistence and Self-sufficiency
In a traditional society, people often live by substance. They do not depend on any other people for survival, because they grow or produce everything that they consume. If they cannot grow or make it themselves, they do not have it. Living on subsistence allowed the people to be self-sufficient, but this was quite limiting, because they spent so much of their lives producing food and shelter, they did not have time to develop and make other products that they may want.

Trade changes everything, because it allows people to specialise. One person specialises in growing grain. Another specialised in catching fish. A third person specialises in baking bread. Each one does what he is most skilled in doing. By focusing on one task, each person could increase their skills and find ways to do a task more efficiently.

The person who specialises can produce more than they need to survive. They can trade their surplus production with others to get all the things they want. Trade improves the situation of almost everyone.

Over the last fifty there has been a vast increase in specialisation and trade. The Japanese have specialised in making flat screen TVs, New Zealand has specialised in producing milk powder and special effects for movies. Americans have specialised in making autos. The Chinese have specialised in manufacturing clothing. This trade and specialisation makes most people better off.

I do not have a clue about how to make a computer or a flat screen TV. I could not make a decent automobile, if I worked on if for a hundred years. If I made my own clothes, I would look like a caveman. However, by specialising in tasks that I am skilled at doing, I can afford to buy all these things and many more.