Law of diminishing returns

By:
Updated: Aug 20, 2021

A characteristic of a production system with fixed and variable inputs such that, as the amount of any given variable input increases, beyond some point each additional unit of the variable input results in smaller and smaller increases in output (also known as a law of variable proportions).

Reference: Oxford Press Dictonary of Economics, 5th edt.


Sources & references
Risk disclaimer
James Knight
Editor of Education
James is a lead content editor for Invezz. He's an avid trader and golfer, who spends an inordinate amount of time watching Leicester City and the… read more.