Increasing returns to scale is an area in economics that is becoming more important in the literature. The economic phenomenon of increasing returns presents serious conceptual difficulties for the traditional competitive theory of resource allocation. While most firms exhibit constant or decreasing returns to scale, some firms manufacture products whose technology permits increasing returns to scale that are large relative to the market. These goods are an important component of economic activity in a modern economy and are typically commodities produced either by a public sector or, as in the US, by regulated utilities. The author analyses increasing returns using general equilibrium theory to take into account the interactions between production
in the public and the private sectors and the effects of financing the public sector on the redistribution of income.
Readership: Economists, especially economic theorists and business economists.
Martine Quinzii, Associate Professor of Economics, University of Southern California
"`The main contribution of this book lies in the consistency with which the author has analysed increasing returns within the framework of general equilibrium theory ... This is an elegant book which provides a rigorous technical framework for discussing real world problems such as the pricing of public utilities ... a succinct monograph.'
Times Higher Education Supplement"