Which of the following is NOT true of the specialization of labor?

• A. It can result in greater efficiency within firms.
• B. It always leads to a decrease in overall productivity.
• C. It allows workers to focus on tasks they are most skilled at.
• D. It may require increased coordination among workers.

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the concept of specialization of labor. It refers to dividing the production process into distinct tasks, allowing workers to focus on specific activities where they have skills or comparative advantage.
2. Step 2: Recognize that specialization typically leads to greater efficiency within firms because workers become more skilled and faster at their specific tasks.
3. Step 3: Note that specialization allows workers to focus on tasks they are most skilled at, which generally improves productivity and quality.
4. Step 4: Consider that specialization may require increased coordination among workers to ensure that the different tasks fit together smoothly in the production process.
5. Step 5: Identify the incorrect statement by evaluating whether specialization always leads to a decrease in overall productivity. Since specialization usually increases productivity, this statement is NOT true.