Division of labor is limited by the size of the market. When a market is small, there is a limit to how much specialization and division of labor can occur because there may not be enough demand to support a large number of specialized workers. In such a case, workers may have to perform multiple tasks to keep the business going. On the other hand, in a larger market, there is more potential for specialization and division of labor, as there is a greater demand for a variety of goods and services. This can lead to increased productivity, efficiency, and ultimately, economic growth. However, other factors such as the productivity of capital, cost of production, and availability of factors of production also play a role in determining the extent of division of labor in an economy.