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Dynamic Laws of Returns under Uncertainty

  • King-Tim Mak
Conference paper

Abstract

The study of the effect of resource constraints (limitations) on production has always been an important topic in the theory of production. Turgot [1967] introduced into economic thought a proposition which has come to be known as the Law of Diminishing Returns at the intensive margin. The original spirit of the law was concerned with the restraint on agricultural production imposed by the scarcity of land. From this viewpoint, the particular formulation of the law in terms of diminishing product increments is nonessential to its significance. In bare form, the issue is: whether a bound on the inputs of a proper subset of factors leads to bounded outputs, when the other inputs may be applied in unlimited amounts. This more basic formulation of the law is described by Menger [1936] as an intersecting assertion.

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Copyright information

© Springer-Verlag Berlin Heidelberg 1983

Authors and Affiliations

  • King-Tim Mak

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