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If the coefficient of output elasticity is greater than 1, then production is experiencing increasing returns to scale.
en.wikipedia.org
It is important to note that these increasing returns to scale are a major contributing factor to the growth of cities.
en.wikipedia.org
This last law is the least intuitive and is based on the argument that the non-industrial sector has diminishing returns to scale.
en.wikipedia.org
Firms experiencing increasing returns to scale are also experiencing decreasing average total costs.
en.wikipedia.org
Constant returns to scale is the in-between case.
en.wikipedia.org
This occurs due to centralization of capital and in industries where there are increasing returns to scale.
en.wikipedia.org
The law of diminishing marginal returns applies regardless of whether the production function exhibits increasing, decreasing or constant returns to scale.
en.wikipedia.org
Adding more inputs will not increase the income earned per unit of input (unless there are increasing returns to scale).
en.wikipedia.org
If the production function contains only one input, then the output elasticity is also an indicator of the degree of returns to scale.
en.wikipedia.org
Under the assumption of constant returns to scale, it is equal to the proportion of national income received in profits.
en.wikipedia.org

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