CALCULATION, INTELLECTUAL DIVISION OF LABOUR AND DISPERSION OF KNOWLEDGE

Distribution of the titles of ownership among private entrepreneurs is inextricably linked to something that Mises called the “intellectual division of labor” (Mises 1990: 18). Control of particular production resources belongs to their sovereign possessors, and not to one person or a collectively managed institution. Here we should distinguish the traditionally understood division of labour from its “intellectual” counterpart. Division of labour means a division of performed production tasks, categorized into particular professions (baker, carpenter, doctor, etc.), while intellectual division of labour is related to a certain kind of divided tasks, linked closely to the function of the entrepreneur, who allocates economic resources in a competitive order. The intellectual division of labour means a division of labour between entrepreneurs on the market, each of whom leads a separate business activity. Salerno concludes emphatically in his pathbreaking work:

In this meaning the term used by Mises is not fully appropriate. The adjective “intellectual” seems to suggest that we are talking about matters of intellect, education and the gift of intelligence. The term may therefore be wrongly understood as, for example, a division between computer programmers and manual workers, i.e. between people who do physical, and those who do intellectual, work. But this is not the essence of the term. Rather, it is about the entrepreneurial division of labour that occurs between different competitors on the market. Using this term seems therefore more accurate, as it more precisely expresses the nature of the phenomenon and prevents misunderstandings with regard to the definition. Biological studies seem to confirm this as man’s ability to reorganize the surrounding reality has more to do with the prefrontal cortex, not with a priori IQ skills (although the latter is definitely useful in running a business).