You're looking at Less Wrong's discussion board. This includes all posts, including those that haven't been promoted to the front page yet. For more information, see About Less Wrong.

VipulNaik comments on Supply, demand, and technological progress: how might the future unfold? Should we believe in runaway exponential growth? - Less Wrong Discussion

14 Post author: VipulNaik 11 April 2014 07:07PM

You are viewing a comment permalink. View the original post to see all comments and the full post content.

Comments (57)

You are viewing a single comment's thread. Show more comments above.

Comment author: VipulNaik 15 April 2014 03:53:00PM 1 point [-]

This is often referred to as the learning curve in microeconomics.

I already mentioned (and linked to) the term "experience curve effects" which is synonymous. I didn't claim this is unique to any specific industries, just that it was somewhat related to the point about the time-directionality of technology. I had written:

This sort of time-directionality is closely related to (though not the same as) the idea of experience curve effects: instead of looking at the quantity demanded or supplied per unit time in a given time period, it's more important to consider the cumulative quantity produced and sold, and the economies of scale arise with respect to this cumulative quantity.

You write:

Whilst the decrease in average cost due to economies of scale is along the long run average cost curve, the decrease in average cost due to this learning is a shift in the long run average cost curve. This is also routine as one would imagine and a good example is a potato chip factory.

Yes, I agree.