1.1 KiB
Productive and Unproductive Labour
Definition
A fundamental classification of economic activity distinguishing labour that adds value to materials through transformation into vendible commodities from labour that provides services without creating lasting value. Productive labour fixes and realizes itself in particular subjects or commodities that endure after the labour is past and can be stored, exchanged, or employed again, while unproductive labour perishes in the very instant of performance without leaving any vendible commodity or value that can be stored or exchanged.
Source Chapter
Book II, Chapter 3
Context
The central analytical framework of this chapter, introduced to explain how different types of labour affect capital accumulation and economic growth. Smith uses this distinction to show why manufacturers grow rich while those maintaining unproductive servants grow poor, and how this affects the overall productive capacity of a nation.
Economic Domain
Production