The concept of the division of labor is explored in this key idea, and how it can increase productivity. Smith argues that by breaking down a complex task into smaller, specialized tasks, workers can become more efficient in their respective roles. He provides the example of a pin factory, where each worker specializes in a specific task, such as straightening wire or sharpening points. Through this specialization, the workers are able to produce a much larger quantity of pins than they would have been able to if they were each responsible for the entire process.

Smith also notes that the division of labor not only increases productivity, but also improves the quality of the product. By focusing on one specific task, workers are able to perfect their skills and produce higher quality goods. This is because they are not distracted by other tasks and can devote their full attention to their specialty.

Furthermore, Smith discusses how the division of labor can also lead to technological advancements. As workers become more efficient in their tasks, they may develop new tools or methods to increase their productivity even further. This, in turn, can lead to new inventions and advancements in technology.

Overall, Smith argues that the division of labor is a crucial component of economic growth and prosperity. By allowing workers to specialize in their respective tasks, productivity can increase, quality can improve, and new technological advancements can be made.