Starter A new £100 banknote The Bank of England has assigned the production of a new £100 banknote to your company. List as many of the separate processes or tasks as you can that will be required from development to the finished product. Question : Why is the £20 important to economists?

Lesson Objectives: Define and explain specialisation and the division of Labour Analyse the role of Adam Smith Demonstrate the advantages of Division Of Labour Discuss the drawbacks of Division of Labour and Specialisation Examine how money improves exchange and makes economies more efficient.

The Division of Labour Key Term: Division of labour is the specialisation of workers; where the production process is broken into a sequence of tasks, with workers assigned to particular tasks. Key Term: Production is the process of turning inputs into output Productivity measures how efficiently a factor of production turns inputs into output. Labour productivity can be worked out using the following formula: Total output per time period ______________________ Number of units of labour

Key Term Specialisation – A process where economic units, such as individuals, households or countries, produce a limited range of resources and trade with one another When specialisation occurs between nations, a country like China, can produce textiles and trade those for cars produced in the USA. Specialisation can also occur within economies. The City of London specialises in financial services and Stoke-On-Trent specialises in pottery. Specialisation by individuals is known as ‘The Division of Labour’

The Division of Labour Game! Mrs Reid has decided that the Economics office is a bit dull and needs decorating You will be working in teams, competing to see which team can make the most paper chains using the materials provided…

…The Teams… Captains: Team A – Lucy Team B – Shannon Team C – James Team A: Lucy, Arman, Georgina, Alex, Sian, Emma Team B: Shannon, Rebecca, Emily, Avnish, Amy, Zara, Taylor Team C: James, Amirah, Francesca, Natasha, Anna, Nina

The Rules Each paper chain must be six links long Each link must be 2.5 cm thick The Chain must be in the correct colour order: purple, brown, pink, purple, brown, pink CHAINS WILL BE CHECKED AND TESTED FOR QUALITY! There will 2 rounds of competition. The winning team will be the one with the highest accumulative total from the two rounds. In each round, you will have 6 minutes to make as many chains as possible.

…The 1 st Round… In this round every member of the team must be involved in all the tasks involved in the production of paper chains. You must therefore work individually. Doing the measuring, cutting and sticking of the chains yourself and adding the chains you make to the groups total. GO!

…The 2 nd Round… Now we will work again but this time putting the theory of the division of labour to the test! Each member of the group must now specialise in one of the tasks. The team captain will assign you an appropriate role based on the strengths/weaknesses you demonstrated in the last round. There will be 2 of you on some tasks. The captains must figure out where ‘bottle necks’ might occur and place workers accordingly. Go!

Benefits of The Division Of Labour Increased Aptitude – Repetition leads to greater accuracy Time Saving – Less time wasted switching between tasks Working to One’s own Strengths - allows people to do what they are relatively best at Use of Capital Equipment – As tasks are sub-divided it becomes worthwhile using equipment

Using the evidence from the demonstration answer the following questions Q1. List at least 3 benefits of The Division of Labour. Q2. Describe any drawbacks to The Division of Labour that may arise in a workplace. Q3. What are the inputs used in the production of the paper chains? Q4. Calculate the labour productivity in both sessions. In which session was the labour more productive?

Adam’s Smith’s pin factory

Activity Case study questions page 60