United states cities to visit for For Smith, division of labor and the consequent increase in labor productivity depend on two conditions: the possibility of exchange and the prior accumulation of capital. Capital is defined as that part of a person’s stock that is reserved for the purpose of earning further revenue. Capital is divided into two major parts. Circulating capital consists of goods purchased for resale, goods meant to maintain productive labor, raw materials, and money for trade purposes. Fixed capital refers to factories and equipment, farm animals, and improvements in the land. There are three reasons why the division of labor requires a prior accumulation of capital. First, there is a gap between the application of labor and the emergence and sale of the product. United states cities to visit 2016.