Summary Adam Smith Wealth of Nations

November 20, 2016
Modern evaluations[edit]

Book I
Chapter I
Chapter II
Chapter III
Chapter VI
Chapter V
Chapter VI
Chapter VII
Chapter VIII
Chapter IX
Chapter X
Chapter XI

Chapter I
OF THE DIVISION OF LABOR

Vocabulary for this chapter:
Opulence - a wealth or abundance.

Chapter Summary:
Smith begins his book by stating that the division of labor has resulted in the greatest improvements in industry. He notes that while division of labor can be see in most industries, it is much more noticeable in the big ones. He then goes on to use the example of a sewing pin manufacturer. He notes that while any of the individuals in the plant might be able to make perhaps one pin in a day by themselves, ten of them if they divide up the labor, they can make thousands in a day.

He then notes that in any industry where division of labor can take place, gains in proportion to that of the pin manufacturer are seen: however; there are some industries where division of labor is just not possible in the magnitude of the pins. Smith's example of this is the farmer, and how the tasks of plowing the field and reaping the harvest can not be divided because they are seasonal in nature. Using this he notes that because agricultural labor can not be vastly more productive with the division of labor, corn in undeveloped countries is almost the same price as those in developed countries, while manufactured good are much cheaper in the developed.

Smith states that there are three main contributors to why the division of labor works as well as it does. The first is that when people spend their entire lives doing one specific focused task, they become very good at it, and can complete that particular task faster then anybody who tries to master other skills as well. The second is the loss in time of switching tasks. This does not just mean the time it takes to drop a hammer and pick up a screwdriver, but also the mental adjustment that has to take place in order to be working 100% at that task. The third is when people are focused on a simple task, they are more apt to discover a better way of doing that task. Smith states that whenever he walks into a factory, he is constantly shown contraptions developed by workers to save time and labor. As a small addition, Smith also states that the division of labor in philosophy and science will yield more efficient methods of doing things.

He then makes a note that in a well off society, when more people have produced more goods, they will as a whole be a richer society. He then concludes this chapter by speaking about how much labor and industry must be employed to furnish a worker with a simple woolen coat, and how even though this is a simple dress, it is really almost as complicated as a prince's coat.

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