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Economics glossary · The economic problem

Division of labour

What division of labour means in economics, with an example and a question to test yourself.

Definition
Division of labour
The division of labour is splitting the production of a good or service into separate tasks, each done by different workers.
Not to be confused with: Specialisation
Specialisation is when a person, firm, region or country concentrates on the tasks or products it is best suited to.
Test yourself

What is the difference between division of labour and specialisation?

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