Front Page Titles (by Subject) CHAPTER III: co-operation, or combination and division of labour - Wealth: A Brief Explanation of the Causes of Economic Wealth
The Online Library of Liberty
A project of Liberty Fund, Inc.
CHAPTER III: co-operation, or combination and division of labour - Edwin Cannan, Wealth: A Brief Explanation of the Causes of Economic Wealth 
Wealth: A Brief Explanation of the Causes of Economic Wealth (London: P.S. King and Son, 1922).
About Liberty Fund:
Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.
The text is in the public domain.
Fair use statement:
This material is put online to further the educational goals of Liberty Fund, Inc. Unless otherwise stated in the Copyright Information section above, this material may be used freely for educational and academic purposes. It may not be used in any way for profit.
co-operation, or combination and division of labour
A NUMBER of men living in such circumstances that they can communicate with each other may, if they choose, work together or co-operate. Co-operation, intelligently directed, enormously increases their aggregate power of producing the effects they desire.
The advantage of what has sometimes been called “Simple Co-operation”—the kind of co-operation which takes place between a number of men when they unite their forces in doing precisely the same kind of work—scarcely needs detailed exposition. Two isolated men within hail of each other would obviously often be justified in abandoning their isolation in order to assist each other in tasks which were beyond the strength of a single man but within that of two, such as lifting a heavy weight, or which could not be accomplished quickly enough by a single man, such as the getting in of a crop of grain while the weather holds. Scientific discussion and interest relate exclusively to more complicated forms of co-operation, sometimes called “Complex Co-operation,” but more usually “Division of Labour,” in which different kinds of work or labour are allotted to (or “divided” between) several or many different individuals who. consciously or unconsciously, unite their forces for the attainment of some end.
1. The first of the advantages of division of labour is that it enables man to make the best use of the various qualities possessed by different parts of the surface of the earth. If each man worked entirely by himself, he would be obliged to get everything from a very small area. Even if he wandered about, and managed to avoid coming into fatal collision with other men in the course of his wanderings, he could not cover very much ground, and if he had a home to which he returned every night or even every few days, his range would be so small that he could only reach a small selection of the numerous materials which we consider “necessaries of life.” Even those men who were lucky enough to find themselves in what would then be considered the best situations on the globe, where all the barest necessaries of life and a few luxuries could be obtained, would be confined to a very few of the minerals and other things which we dig or quarry from the earth. The situations least suitable for such a social or anti-social state, where the available selection of materials is too small, would be quite uninhabitable. With division of labour, on the other hand, it becomes possible to make full use of a situation which is only good for the production of one or a few articles or services, as the Rand is good for producing gold and Jersey for producing early potatoes.
The importance of this is obvious, and it is illustrated by well-known facts in the history of the world. Peoples which have been confined to the products of a small area have always remained in that condition which we call “primitive” or “barbarous”: restricted to a small selection of materials, they have had little opportunity of making mechanical improvements, even if they had the necessary inventive faculty. Civilization started where communication, and consequently co-operation, were easiest, and so far as we can go back in history, the peoples which are now civilized have had a large supply of products brought from distant places. Silver and gold, for example, found only on a few spots, have always been spread over the whole area of civilization.
We must not think only of the impossibility of obtaining certain products from certain areas. There is a good deal more than that to be considered. There are many degrees of difficulty short of the infinite degree which is literal impossibility. We get coffee from Brazil, tea from Ceylon, and bananas from Teneriffe or Jamaica, not because it is absolutely impossible to grow these things in England, but because it is much more difficult to grow them here where the soil and climate are not so suitable. Soils and climates differ in such a way that the wants of mankind as a whole can obviously be best satisfied by a certain concentration not merely of the industries which can only be carried on in particular places, but also of a great many others for which the circumstances of some places are more favourable than those of others. What is required may, perhaps, be easier grasped if we confine our thought for the moment to the area of a single farm which includes several soils and aspects. In such a case the cultivator will consider these different soils and aspects, and distribute the land between different products in the way he thinks will be best on the whole, taking everything into account. It would be obviously the act of a madman to insist on growing a little of everything on each acre, or to cut the farm up into sections for wheat, meadow, potatoes, and so on with no regard to anything except facility of transport to the homestead. Mankind at large is in much the same position: it will find it advantageous to concentrate each of the great majority of industries to some extent on particular areas, although this course involves more labour of transport. The chief difficulty which we encounter In extending our view from the single farm to the world arises from the fact that in dealing with the single farm we usually accept the position of the homestead, and consequently also the destination of the produce, as settled once for all by historical circumstances. When we consider the world at large, on the other hand, we have to allow for the fact that the location of mankind is not fixed. Consequently the position of the consumers cannot be taken as given; the question of the concentration of particular kinds of production in particular areas is inextricably inter twined with the question of the distribution of population. To attack the problem in its most abstract form, we should suppose ourselves a benevolent being with the Earth uninhabited before us and its whole population in our hand ready to be planted where we please on its surface and to do what we order. How should we then best arrange the people and the industries? The task would certainly be a puzzling one, but with omniscience we could solve it exactly, and the solution would obviously involve a considerable concentration of industries and of population on particular areas. It would probably be seldom, if ever, desirable to concentrate the whole production of any particular commodity in a single district, since the disadvantage of having to transport the product to every place where for any reason it was desirable people should live would seldom be overbalanced by the superior qualities of any one district: for example, it might be desirable to plant a certain amount of cotton manufacture in South Carolina or Bombay, although neither of those places were quite so suitable for the actual production, considered apart from transport, as Lancashire. So concentration would usually be only considerable—certainly not unlimited.
We must be very cautious about accepting any short and taking phrase for a summary description of the advantage resulting from the local concentration of industries. To say, for instance, that it “enables everything to be done in the place best fitted for the purpose” is not satisfactory, since it often happens that one place is the best fitted for carrying on two, or even more than two, different industries. Then, as there is not room for more than one, the others must be placed not in the best, but in the second or even third, fourth, fifth, or sixth best place. Industries must be arranged in what is the best way on the whole, taking into consideration all of them and also the amenities enjoyed by the consumer so far as these are to be considered separately from the industries. This last proviso, concerning amenities, is necessary in order to prevent such things as the discomfort of living in a bad climate from being overlooked. A concentration of industries which was extremely good so far as the mere product of the industries was concerned would be a very bad one if it compelled a large part of the people of the world to live on the Antarctic continent. If we adhere to the phrase adopted at the beginning of this section, and say that co-operation enables man to make the best use of the various qualities possessed by different parts of the earth's surface, we seem to be on fairly safe ground.
In practice, of course, the question is never presented as a whole. The past course of the world's development has resulted in a certain distribution of people and industries over the face of the earth, and it is obviously undesirable to make, or rather to attempt to make, any very enormous change in it suddenly, even if we think we know that a wholly different arrangement would be best if we were to start with a tabula rasa. We are actually more in the position of the farmer we mentioned just now, who comes into possession of a farm already provided with a homestead in a particular spot, and already divided into fields, each of which has had certain qualities given to it by the past labour of man, so that it is more appropriate for some purposes and less appropriate for others than it would have been if left in its natural state. Such a cultivator has not to consider the very difficult questions of what would be the best position for the homestead and what would be the best distribution of the whole area of the farm between different kinds of cultivation if he could, as he would say, “start the whole thing fresh,” but only the much easier questions of whether it would pay him to take down and remove the homestead to another situation and alter the acquired qualities of all or some of the fields, as, for instance, by ploughing up the pasture and converting the meadows to arable cultivation, or by removing some of the hedges or walls in order to redistribute the area on new principles. In the same way, if we take the world at large at any particular moment, we find people already settled in certain proportions over its area, with their homes and work-places already built, and the land, or most of it, already adapted by the past labour of mankind to various uses. We find, too, that the population of the globe, consists of various races, for the most part concentrated on particular continents and in particular countries, and that these races are of very various powers or in very various stages of development. It would obviously be impossible, and undesirable if it were possible, to make any great, sudden redistribution of these people, their homes, and their industries. All that mankind has to do is to change things very gradually in the right direction. It was, for example, never necessary to remove the iron-workers of Sussex or the woollen-workers of Wiltshire to Yorkshire: the redistribution was quietly accomplished by the rise and growth of these occupations in Yorkshire, coupled with the dying out of the iron-workers in Sussex and the absence of increase among the woollen-workers of Wilts.
The names “territorial division of labour” and “localisation of industry” have sometimes been applied to co-operation which involves the concentration or, as perhaps it would be safer to say, the unequal distribution of industries on the face of the globe.
2. The second great advantage of division of labour is that it enables labour to be so distributed between different persons that their original or natural qualities may be best utilised. According to the old distich, “Adam delved and Eve span,” but this is a fourteenth century anachronism. Modern research rather suggests the probability of Adam having been a thorough “gentleman” of sporting proclivities, while Eve did any heavy work which had to be done. There is not much reason for believing that primitive man arranged co-operation in the most satisfactory way so far as this advantage is concerned; the strength of the strong was apt to be utilised not in carrying the heaviest burdens, but in forcing them on the backs of the weaker. Nevertheless, at any rate in times of stress, the advantage of distributing the whole of the work to be done among the old men, the young men, the women, and the children in such a way as to make the best use of their respective powers must have been apparent even to the most primitive barbarians. A very little consideration is necessary to make us see that this rough division can be improved by taking into account the various natural qualities of the different persons in each of the four classes. In each class we find great and little strength and stature, great and little mental ability. Examining still more minutely, we find that some have the particular strength of mind or body appropriate for some particular kinds of work, while others have the strength required for other kinds of work. Obviously it will be better to divide the whole of the work to be done between all the workers concerned in such a way that the work requiring great strength is given to the strong, work requiring dexterity of mind to the clever, and so on, as far as possible. The proviso “as far as possible” is necessary because, just as it is not true to say everything must be done in the place best fitted for it, so it is not true to say everything must be done by the person best fitted for it. Often the person best fitted for one kind of work will also be the best fitted for another kind of work or for several other kinds: he must then be allotted the labour which it is best he should perform when the special capabilities of all the workers, including himself, are taken into consideration. Some of the work will then necessarily be allotted not to the person best fitted for it, but to the second, third, fourth, and fifth best fitted.
In practice this advantage of division of labour is inextricably mixed up with the third, to which we now proceed.
3. The third advantage of division of labour lies in the fact that it enables much greater skill and dexterity of hand and brain to be acquired for each of the various occupations. “Jack of all trades” is proverbially “master of none.” A person who had to supply all his own needs would have to do so many things that he could not expect practice to make him perfect at any of them. When different kinds of labour are allotted to different persons, so that the whole or greater part of the working time of each is given to one or at any rate a few kinds of labour, each acquires in a high degree that special dexterity required for his particular work which is obtained by practice. Furthermore, it becomes possible to give to each person the perhaps more important kind of skill and dexterity which is to be obtained by education or deliberate training. Human life is far too short to make it worth while to give individuals the elaborate training necessary for more than one of the more difficult employments. To train a man adequately for one of them takes a large slice out of his life. Evidently there is great economy in training each person for at most a very few employments. This is specially remarkable in what is generally called “scientific research.” In modern times discoveries of new means of utilizing natural forces are not to any great extent made by accident, but are for the most part the result of investigations which could only be carried on successfully by men who have spent not years, but decades, in being trained and training themselves.
This advantage is necessarily mixed up with the second, because when once particular qualities have been acquired, it does not matter whether they have been acquired by training and practice or are the result of “original” or “natural” characteristics. At any particular moment we find the persons who form the population of the globe endowed by nature or education with certain qualities, and the problem before mankind is to make the best use of these qualities, regardless of their origin.
So it must often happen that persons whose natural or original qualities marked them out for some one occupation can best be retained in some other occupation for which they have as a matter of fact been trained. To secure the fullest advantage of the possibility of dividing labour according to the natural qualities of the workers it is necessary to distribute the required education and training in the best manner. Under any conceivable circumstances this would be a difficult thing to do, even if the future could be exactly foreseen in all its details. But the future cannot be exactly foreseen, and this increases the difficulty of securing even an approximation to a correct distribution of persons between the various occupations in accordance with their natural and acquired characteristics.
4. The fourth advantage of division of labour is that it greatly facilitates the acquisition and retention of the sum of knowledge which is transmissible from one generation to another. This is quite distinct from the advantage of skill and dexterity just discussed. Skill and dexterity enable people to use known processes effectively, but knowledge reveals the processes themselves. Without division of labour the inventions and discoveries which have made modern man's power over the forces of nature so much greater than that of his remote ancestors could not have been made, because no man would have had time to specialize sufficiently in the particular lines of study required. When the knowledge has been once acquired, it would often be lost if it were not for the existence of books and instruments which could not be produced without division of labour. In other cases the retention of the knowledge in the world is only effected by means of the exertions of a class of educators, which, again, could not exist in the absence of division of labour.
5. The fifth advantage of division of labour is that it economises tools and machinery of all kinds, including the buildings in which work is carried on. By this we mean that it makes a given amount of machinery “go farther,” or be more effective, and so makes it advantageous to mankind to provide itself with machinery which would otherwise be too costly. Every one has experienced difficulties from the want of appropriate tools when he has attempted quite simple jobs outside his own trade or profession. “Jack of all trades” is not only unskilful, but also ill-provided with tools. Evidently if every one had to do all kinds of work, it would have to be done for the most part with very much less effective tools and machinery than at present. As things are, these things can be liberally provided, even when costly, because the division of labour allows them to be kept in continuous use, which would be impossible if every one had a complete equipment of each.