Overview: When one of the factors of production is held fixed
in supply, successive additions of the other factors will lead to
an increase in returns up to a point, but beyond this point returns
will diminish.
This famous law was first written about by a Frenchman, Anne Robert
Jacques Turgot and then alluded to by Thomas Malthus in his Essay
on the Principle of Population (1798). Sometimes textbooks call
it the law of decreasing (marginal) returns or the law of variable
proportions.
Tags: Diminishing Returns, diminishing marginal returns, law
of diminishing returns
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Source: Chris Rodda
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