![]() ![]() To start with, some leading economists have repeatedly warned that contemporary economies worldwide are now entering the Law of Diminishing Returns stage wherein more investment is needed to generate the needed economic output. How Diminishing Returns from Capital Lead to Speculation and Rent Seeking Behaviour We will discuss its implications and effects. What this means is that all economic activities tend to Regress Progressively (to use an Oxymoron) wherein each unit of investment generates diminishing units of returns leading to economic activities being unsustainable in the longer term. The Law of Diminishing Returns states that as more and more capital is invested in producing goods and services, there comes a point where the output from such activities or in other words, the returns from such investments diminish gradually leading to a situation where there is a need for more capital to generate the diminishing returns. In this context, a very important law in economics is the Law of Diminishing Returns which deals with returns on investment and capital according to specific conditions. ![]() More than a science and an art, Economics is also a discipline that blends theoretical depth with scientific rigour and most leading economists are also Avid Students of Life making them experts in fields beyond the Dismal Science, as some characterize the subject of economics. What is the Law of Diminishing Returns and why we are Regressing Progressively?Įconomics is a fascinating subject that helps us understand how modern societies work in economic terms. ![]()
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