In order to comprehend the ontological construction below, please refer to the respective posts for all notions in italic.
Economy of scale is defined by the optimal market structure of supply and demand for commodities. In any set of interrelated commodities, there is an optimal market share a good can amount to. It is described by the midpoint between increasing productivity and decreasing productivity for a product, as the respective commodity supply is extended accordingly under the conditions of market demand. Economy of scale recasts the constant productivity of economic goods in a market form.
Historical Backdrop
• FRANÇOIS QUESNAY The Economic Table: scale to production.
• ALFRED MARSHALL Principles of Economics: external and internal economy of scale.
• KNUT WICKSELL Value, Capital and Rent: the sum of all marginal products equal the value of the commodity under conditions of constant returns to scale.
• PHILIP WICKSTEED An Essay on the Co-ordination of the Laws of Distribution: constant returns to scale and the Law of Distribution.
