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.

To illustrate division of labor, Smith counted how many tasks went into making a pin: drawing out a piece of

wire, cutting it to the right length, straightening it, putting a head on one end and a point on the other, and

packaging pins for sale, to name just a few. Smith counted 18 distinct tasks that different people

performed—all for a pin, believe it or not!

Modern businesses divide tasks as well. Even a relatively simple business like a restaurant divides the task of

serving meals into a range of jobs like top chef, sous chefs, less-skilled kitchen help, servers to wait on the

tables, a greeter at the door, janitors to clean up, and a business manager to handle paychecks and bills—not to
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