A Benefit from the Division of Labor that Adam Smith Missed

Wenli Cheng

No 16-10, Monash Economics Working Papers from Monash University, Department of Economics

Abstract: This paper argues that there is an important benefit from the division of labor that Adam Smith failed to mention, that is, the division of labor shortens the time required for capital formation and makes continuous roundabout production possible. The paper presents a simple general equilibrium model to demonstrate this benefit, which is referred to as the “value of time” benefit of the division of labor.

Keywords: the division of labor; time structure of production; capital formation; transaction costs (search for similar items in EconPapers)
JEL-codes: D92 O10 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2010-05
New Economics Papers: this item is included in nep-hpe
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Related works:
Journal Article: A Benefit from the Division of Labor that Adam Smith Missed (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:mos:moswps:2010-16

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