The Assumption of Constant Returns to Scale
AbstractNicholas Kaldor was right to maintain that this assumption is unrealistic, but that does not mean that it is useless. There are propositions that can be proved assuming it, which would never have been found without it, but that look as if they are independent of it. Two examples: (1) Paul Samuelson's factor-price equalization theorem in international trade and (2) the author's theory of relations between factors in production (" elasticity of substitution" in a modern form). P-and q-substitutes (complements) must be distinguished. Weakly related factors are p-substitutes and q-complements. This is the only case when no more than two factors are present. Otherwise, two factors (out of many) may be strong substitutes (substitutes both ways) or strong complements (complements both ways). The excluded case, when they would be p-complements and q-substitutes, appears, in the presence of scale economies, to be excluded a fortiori. Copyright 1989 by Oxford University Press.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by Oxford University Press in its journal Cambridge Journal of Economics.
Volume (Year): 13 (1989)
Issue (Month): 1 (March)
Contact details of provider:
Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Fax: 01865 267 985
Web page: http://www.cje.oupjournals.org/
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Alam, M. Shahid, 2013. "Constant Returns to Scale: Can the Neoclassical Economy Exist?," MPRA Paper 45153, University Library of Munich, Germany.
- Carcillo, S. & Reiffers, V., 2000.
"La critique d'Ad Hocite en economie - L'exemple des Theories de la croissance,"
Papiers d'Economie MathÃÂ©matique et Applications
2000.23, UniversitÃ© PanthÃ©on-Sorbonne (Paris 1).
- Stéphane CARCILLO & Véronique REIFFERS, 2001. "La critique d’ad hocité en économie. L’exemple des théories de la croissance," Discussion Papers (REL - Recherches Economiques de Louvain) 2001025, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
- Knaap, T., 1998. "A survey of complementaries in growth and location theories," Research Report 98C44, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
- Sumit Majumdar, 1999. "Comparative Organizational Characteristics of Indian State-Owned Enterprises," Review of Industrial Organization, Springer, vol. 15(2), pages 165-182, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.