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Economies and Diseconomies of Scale

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The New Palgrave Dictionary of Economics

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Abstract

We consider the unit costs of producing a (single or composite) output under a given technology (no technical change). We say that there are economies (or diseconomies) of scale in some interval of output if the average cost is decreasing (or increasing) there. This definition focuses on economies and diseconomies of a technical character. It is sometimes extended to cover business activities other than production (such as marketing, financing, training: see Scherer 1980).

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Authors and Affiliations

  1. http://link.springer.com/referencework/10.1007/978-1-349-95121-5

    Joaquim Silvestre

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  1. Joaquim Silvestre
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© 2018 Macmillan Publishers Ltd.

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Silvestre, J. (2018). Economies and Diseconomies of Scale. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_546

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