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A term going back to Plato and summarized and modified by Adam Smith in his 1776 An Inquiry Into the Nature and Causes of the Wealth of Nations to refer to the partitioning of the capitalist economy into specialized occupations and production types. This specialization was criticized by Karl Marx. In organizational theory, it refers to the differentiation of jobs into specialized positions and tasks, including the proper allocation of people and machines. For more information, see Smith (1776/1977).

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