The difference between increasing returns to scale and economies of scale in microeconomics

Economies of scale are when the total output increases more than the total cost when the enterprise expands its scale, that is, the long-term average total cost decreases. Otherwise, it is called diseconomies of scale.

Remuneration of scale, also known as scale gain, is the income obtained by the firm due to the proportional change in the input of all factors of production (i.e., the change in the scale of production), which indicates the impact on the output (i.e., the total output) when the input of all factors of production increases in the same proportion. It is divided into three types: constant scale return, increasing scale return and decreasing scale return.

Increasing returns to scale: The proportion of growth in output is greater than the proportion of growth in inputs.

Increasing returns to scale: The proportion of growth in output is smaller than the proportion of growth in inputs.

Intrinsic economy: When the scale of the enterprise increases, the average total cost decreases due to its own internal factors. Otherwise, it is called intrinsically uneconomic.

Extrinsic economy: The expansion of the industry scale has reduced the average total cost of a single manufacturer. Otherwise, it is called external uneconomic.

Economies of scale are not necessarily internal or external, depending on the specific conditions.

The increasing return to scale means that when the factors of production are increased by the same multiple, the output can increase by more multiples, for example, when labor and capital are both increased by 2 times, if the multiple of the increase in output is greater than 2, it is an increase in the return to scale.

Economies of scale mean that when production increases, the average cost of the manufacturer decreases.

In other words, the incremental return to scale is for output, and economies of scale are for cost. Hehe.

These two concepts are actually one after the other, interrelated.

Remuneration of scale, also known as income of scale, refers to the change of income or output brought about by the change of all factor inputs in a certain proportion under the condition that the technical level and factor ** remain unchanged. It is divided into three situations: increasing returns, decreasing returns, and unchanged.

In the case of increasing returns to scale, the proportion of new increase in input costs should be "the proportion of new increase in output", and the resulting decrease in average production costs can be summarized by economies of scale.

I don't know if you understand?

The U-shaped shape of the LAC curve is mainly determined by the change in scale returns. When the size of the factory is very small, as the factory expands, the increasing return to scale leads to the intrinsic economy of scale, which means that the LAC decreases. When the scale is expanded to an optimal extent, the return to scale decreases, resulting in intrinsic diseconomies of scale, which means that the LAC rises.

There is no direct correlation between the external economy and the LAC

Give a few entries meaning for easy understanding.

1. Economies of scale: The manufacturer's LAC decreases with the expansion of production scale.

2. Diseconomies of scale: the phenomenon that the manufacturer's LAC increases with the expansion of production scale.

3 The external economy generally refers to the production of goods of beneficial externalities. Externality uneconomy usually refers to goods that are harmful to externalities.

Externalities, also known as spillover effects, external influences, externality effects, or externalities, are the actions and decisions of one person or group of people that make another person or group of peopleIn the event of damage or benefit。Such externalities sometimes have a positive effect (education and security increase social productivity) and sometimes a negative effect (pollution and crime reduce social productivity).

According to the different effects of external effects, external effects are divided into external economy and external uneconomy.

1. The external economy usually refers to the production of goods with beneficial externalities. The production of such goods has positive social and environmental effects (e.g. education and security). For example, the beekeeper's beekeeping behavior is beneficial to the rose field next doorAdvantages that cannot be compensated or claimed

2. External uneconomy usually refers to goods that are harmful to externalities. The production of such goods has negative social and environmental effects (e.g. pollution and crime). The same is true for the pollutant discharge behavior of manufacturers.

1. The way to determine the business is different.

Economies of scale are through the form of announcements to invite unspecified businessmen to participate in the bidding, which can motivate businessmen to consciously apply high-tech to the procurement of products, and at the same time can transfer procurement risks.

In addition to the announcement, the scale remuneration may also be recommended in writing by the purchaser and the evaluation experts, or randomly selected from the ** business pool established by the financial department at or above the provincial level, and the goods or services that meet one of the following circumstances may be subject to competitive negotiation in accordance with this Law.

2. The date of issuance of the document is different.

The requirement for economies of scale is that from the date of issuance of the bidding documents to the date of submission of the bidding documents, not less than 20 days;

The requirement for scale remuneration is from the date of issuance of the negotiation document to the date of submission of the first response document by the first business, which shall not be less than 3 working days;

3. The influencing factors are different.

Economies of scale are important factors that directly affect the size of the market. On the one hand, the scale remuneration is subject to the influence of macroeconomic conditions, and on the other hand, it is affected by the national income distribution policy and consumption policy, and the scale remuneration directly determines the level of consumer purchasing power.

The former is the monetary relationship between output and cost, and the latter is the quantitative relationship between input factors and output.

Economies of scale will occur with increasing returns to scale, and economies will be uneconomical when decreasing.

[The economics of international curriculum learning may differ from those in China].

The definition can be found on the Internet, so let's not talk about it.

Our teacher said that the reward of scale is short-term, and the economy of scale is long-term.

My own understanding is that the reward of scale should be added to the factors of production, and economies of scale are not needed, and economies of scale can be generated by expanding the scale.

Both lead to the same thing, increasing or decreasing the long-term average cost.

Remuneration for scale, if all factors of production such as labor and capital invested increase by n times, the output of products increases by m times. If m>n is the increase in the return to scale, where m, the increase in the return to scale means that there is an economy of scale (when the average cost falls).

Diminishing returns to scale mean that there is diseconomies of scale (when the average cost rises).

1. First of all, it is necessary to distinguish the meaning of economies of scale and scale remuneration, economies of scale are due to the improvement of the level of specialization in production, etc., so that the unit cost of the enterprise decreases, so as to form an economy in which the long-term average cost of the enterprise decreases with the increase of output. Remuneration of scale refers to the change in output brought about by the change of various factors of production within the enterprise in the same proportion under the same conditions. Reward for scale analyzes the relationship between changes in the scale of production and the resulting changes in output.

Only in the long run can an enterprise change all the factors of production, and then change the scale of production, so the analysis of the scale remuneration of an enterprise belongs to the long-term production theory. Because the U-shaped characteristic of the long-term cost curve is related to the unit cost, it is mainly determined by economies of scale, but the return to scale also has an impact.

2. Increasing returns to scale are economies of scale.

3. Diminishing returns to scale are diseconomies of scale.

4. Maintain the status quo.

No. When the proportion of output is greater than the input, the scale return increases, and less than the scale return decreases, which is equal to the constant return.

Economies of scale correspond to economies of scope, when the enterprise expands, it is located in the part of the LAC curve that declines, which is the meaning of a bit of a big store bully, I buy in large quantities must be lower than you buy alone, like Wal-Mart is economies of scale.

The scope of economy is about the scope of business, that is, to do everything, he will be on the integration of internal resources, such as Lenovo is not only a computer, he also does real estate, to achieve diversified development.

lz is all hand-beaten, hope can communicate if you don't understand.

Economies of scale refer to the economy in which the unit cost of an enterprise decreases due to the improvement of the level of specialization in production, so as to form an economy in which the long-term average cost of the enterprise decreases with the increase of output. Returns to scale refers to the change in output brought about by the change of various factors of production within the enterprise in the same proportion under the same conditions.

Economies of scale: The fact that the average cost of producing a certain product is constantly decreasing as production increases. In fact, it is equivalent to only fixed costs, and as production increases, the average cost decreases. The larger the scale, the lower the average cost.

The scale return is different, which is divided into increasing scale return, unchanged, and decreasing.

Suppose the relationship between output y and input x is: y=2x

If x is doubled, y is also doubled, that is, the scale reward remains unchanged], the output is less than 2y is decreasing, and the output is greater than 2y is increasing.

Economies of scale are the phenomenon of changes in average costs caused by the increase in scale. Mainly in terms of cost.

Scale remuneration mainly refers to the change in output brought about by the change of various production factors within the enterprise in the same proportion. Mainly in terms of outputs.

Returns to scale are expressed as a technical function, without taking into account the ** factor. Economies of scale, on the other hand, are expressed in terms of cost and are measured in terms of value.

The remuneration of scale is from the perspective of output, and the economy of scale is from the perspective of cost, and the multiple of output increase is greater than that of the factor, that is, the multiple of cost increase.

If the market is good, manufacturers will consider expanding the scale of production and increasing output through the expansion of the scale of production. Expanding the scale of production means that manufacturers must not only invest more labor, but also increase the input of factors such as raw and auxiliary materials, as well as increase the input of factors such as machinery and equipment. The change in output caused by the change in the same proportion of the factors of production is called the change in return to scale.

In the process of scale expansion, there may be three kinds of relationship between input and output: increasing returns to scale. The scale remuneration remains unchanged.

Diminishing returns to scale. When production is in the stage of increasing returns to production scale, the average cost of the product decreases as the scale of production increases, which can be called economies of scale.

There is no such thing as a pay-for-scale.

Because labor remuneration constitutes the cost of goods, it can lead to inflation.

Remuneration to scale refers to the proportion of change in output obtained by changing the quantity of input factors of production in the same proportion. If the proportion of change in output is greater than the proportion of change in input factors, it is called an increase in the return to scale; If it is less than, it is called a diminishing return to scale; If it is equal, then the scale reward is constant.

However, in real life, manufacturers generally do not change the input of production factors in the same proportion when changing the scale of production, so there is the concept of economies of scale. Economies of scale refer to the increase in economic benefits brought about by the expansion of production. On the contrary, if the economic benefits are not improved, it is diseconomies of scale.

The concept of economies of scale does not emphasize the expansion of the scale of production, i.e., the increase in the input of each factor is proportional.

In fact, economies of scale are a state, and increasing returns to scale are a process. If an enterprise is most efficient in the production of 1,000 goods, then the return to scale increases from 1 to 1,000 pieces, while the economy of scale is in the production of 1,000 pieces, and the scale is not in the economy when the production is less than 1,000 pieces.

Purely personal understanding, I hope it will be useful to you.

Hehe, I got this question this year

These two concepts are the same meaning, and the scale return is also called the scale return, which is divided into three types: the scale return is unchanged, the scale return is increasing and the scale return is decreasing.

Among them, the increasing return of scale is also called economies of scale, on the contrary, the diminishing returns of scale are called economies of scale.