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Content: January 26, 2016
Specialisationmeans concentrating the production on a chosen good or service for which a production unit(individual, firm or a country) is more able as far as resources of production are concerned. In other words, it means producing what we produce best. Specialisation is the production of a limited range of goods, and services by an individual firm or a country, in co-operation with others so that, together, a complete range of products can be produced. Specialisation also means that the resources are being distributed among small and competing uses at a particular industry or a nation. For example, Maldives specialises in tourism and fishing products, Sri Lanka and India specialises in the production of tea. This is specialisation at national level. The specialisation of Thoddoo island for watermelons and Dhiggaru island for rihaakuru is an example of regional specialisation. Potential benefits of specialisation
Higher output: the total output of goods and services will increase and the quality of goods and services produced will increase. A higher output with lower prices will mean more wants will be satisfied with the given amount of scarce resources.