something called the division and specialization of labor, a production innovation first put forth by Adam

Smith (Figure 1.3) in his book, The Wealth of Nations.
12 1 • Welcome to Economics!

FIGURE 1.3 Adam Smith Adam Smith introduced the idea of dividing labor into discrete tasks. (Credit: "Adam

Smith" by Cadell and Davies (1811), John Horsburgh (1828), or R.C. Bell (1872)/Wikimedia Commons, Public

Domain)

The Division of and Specialization of Labor

The formal study of economics began when Adam Smith (1723–1790) published his famous book The Wealth

of Nationsin 1776. Many authors had written on economics in the centuries before Smith, but he was the first

to address the subject in a comprehensive way. In the first chapter, Smith introduces the concept of division of

labor, which means that the way one produces a good or service is divided into a number of tasks that

different workers perform, instead of all the tasks being done by the same person.
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