Sunday, March 15, 2009

Division of Labor: Excellence as Scarcity

Julie Neidlinger at Lone Prairie writes about scarcity. Excellence is a form of scarcity, as a book she's reading puts it. I've never thought of it in those terms, but I quickly identified it with the biblical concept (an economic one, too) of division of labor that Ron McKenzie is writing about at Blessed Economist. The concept of division of labor means that people can focus on things they are good at - becoming excellent in those things - and increase the overall standard of living in society.

Being scarce means that with you in low supply, the price fetched for your services can increase. If somebody has general knowledge and skill in a particular area, and you have specific knowledge, you demand a higher price. The buyer can pay one amount for an okay level of service, or a higher amount for excellence. With everybody making themselves more scarce, they can command greater prices, thus making more and being able to hire more people who specialize in more things. This can work with people relationships, too, as Julie points out when she says, "making oneself scarce is no foolish thing." Now, if I can apply this to looking for a job...

1 comment:

  1. I wonder if this applies to "outta sight, outta mind"? The other problem I see/experience in this is if people can't afford it, it doesn't matter how good it is, if people can't afford it, they won't buy it.