Generalization or Specialization

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Generalization vs Specialization "What I do have are a very particular set of skills, skill acquired over a very long career." --Bryan Mills (Taken) From an economic standpoint, the natural state of the world is scarcity. This scarce state is reduced through production. Production combines labor, materials, and technology into outputs that can be consumed. Two general strategies are available to producers. One strategy is to generalize. People who are 'jacks of all trades' are generalists, meaning that they produce many different things. If someone is isolated from others (e.g., the Robinson Crusoe scenario), then that person has no choice but to diversify production. If the isolationist does not produce a variety of outputs such as shelter, food, drink, and clothing, then this individual is unlikely to survive much less thrive. Achieving a state of self-sufficiency could be desirable when markets are uncertain or underdeveloped. But self-sufficiency has its costs as well. Because they frequently shift between products, generalist producers lack the learning-by-doing repetition that permits mastery. Standard of living may therefore suffer. The second general strategy available to producers is specialization. Specialists focus their productive efforts on limited types of output. Focusing production enables the learning-by-doing that improves productivity (i.e., more output per unit of input) over time. Specialization is of little use in isolationist situations since, by definition, the specialist cannot produce the variety of output necessary to satisfy even basic existence. However, when it is possible to trade with others, the specialization strategy becomes particularly interesting. Multitudes of people can focus their efforts on narrow product lines and achieve high levels of productivity through specialization. If these individuals can

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