How Families Fuel Economic Development

The family provides enormous economic advantages to daily life and civilization as a whole. But the extended and even nuclear family have been eroding thanks to changes in government policy, economic trends, and culture. In this article, I highlight how the nuclear and especially extended family supercharge human productivity thanks to the specialization and division of labor found within them.

Every household, whether it consists of one adult or many, has a long list of challenges it needs to constantly meet: earning income, taking care of children, house repairs, cooking, cleaning, doing laundry, etc.

People can achieve a level of productivity beyond the sum of their individual productivities by coming together to form families. One reason is because specialization and division of labor increase efficiency through a variety of mechanisms. Robert Murphy’s excellent textbook Lessons for the Young Economist details these mechanisms.

Natural and Acquired Aptitude

One mechanism is called “natural aptitude.” Some people are just born better at performing some tasks than other people. We have different talents. When people live separately, while they only have to cook for one person, earn income for one person, do the laundry for one person, etc., they must learn to do a little bit of everything.

Contrariwise, in a family where one spouse is better than the other at earning money, making repairs, or teaching the children algebra, etc., total productivity is maximized by having that spouse exploit their natural aptitude to the fullest by focusing on the tasks they’re better at, as opposed to everyone performing a bit of every task irrespective of talent.

Similarly, specialization also increases productivity because of “acquired aptitude.” The more you work at something, the better you get at it. It’s difficult for a person living alone to achieve as much skilled specialization because they have to divide their efforts over a larger number of responsibilities. However, a family can exploit acquired aptitude by dividing the responsibilities among themselves and diving deep into their respective portion of the duties.

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Πηγή: mises.org