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Think back to the last time you overindulged in a huge, delicious dessert. It’s likely that the first bite was divine, but perhaps ...
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Expectoque quid ad id, quod quaerebam, respondeas. Duo Reges: constructio interrete. Itaque hoc frequenter dici solet a vobis, non intellegere nos, quam dicat Epicurus voluptatem. Si de re disceptari oportet, nulla mihi tecum, Cato, potest esse dissensio.
Tu vero, inquam, ducas licet, si sequetur; Quod quidem iam fit etiam in Academia. Quaero igitur, quo modo hae tantae commendationes a natura profectae subito a sapientia relictae sint. Non quaero, quid dicat, sed quid convenienter possit rationi et sententiae suae dicere.
Iam doloris medicamenta illa Epicurea tamquam de narthecio proment: Si gravis, brevis; Non dolere, inquam, istud quam vim habeat postea videro; Positum est a nostris in iis esse rebus, quae secundum naturam essent, non dolere; Quod mihi quidem visus est, cum sciret, velle tamen confitentem audire Torquatum.
- Find the optimal peak.
Know that ‘more of a good thing is not always better’ ...
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ne amores quidem sanctos a sapiente alienos esse arbitrantur. Quod autem in homine praestantissimum atque optimum est, id deseruit. Videamus igitur sententias eorum, tum ad verba redeamus. Quae similitudo in genere etiam humano apparet. Si quicquam extra virtutem habeatur in bonis. Hinc ceteri particulas arripere conati suam quisque videro voluit afferre sententiam. Duo Reges: constructio interrete. Quodsi vultum tibi, si incessum fingeres, quo gravior viderere, non esses tui similis; Nam Pyrrho, Aristo, Erillus iam diu abiecti. Qua tu etiam inprudens utebare non numquam.
Ut proverbia non nulla veriora sint quam vestra dogmata. Praeterea sublata cognitione et scientia tollitur omnis ratio et vitae degendae et rerum gerendarum. Isto modo, ne si avia quidem eius nata non esset. Quid ergo hoc loco intellegit honestum? Conferam avum tuum Drusum cum C. Et quidem iure fortasse, sed tamen non gravissimum est testimonium multitudinis. Inquit, dasne adolescenti veniam? Et ais, si una littera commota sit, fore tota ut labet disciplina. Ex ea difficultate illae fallaciloquae, ut ait Accius, malitiae natae sunt. Etenim nec iustitia nec amicitia esse omnino poterunt, nisi ipsae per se expetuntur.
Octavio fuit, cum illam severitatem in eo filio adhibuit, quem in adoptionem D. Simus igitur contenti his. Quam nemo umquam voluptatem appellavit, appellat; Mihi, inquam, qui te id ipsum rogavi? Sextilio Rufo, cum is rem ad amicos ita deferret, se esse heredem Q. Quis est tam dissimile homini.
The Law of Diminishing Returns is based on a number of assumptions that are not always relevant to real-world situations. These include:
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No change in technology
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A short period of impact
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Consistent, homogeneous units
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Measurement of product using tangible units.
Each of these assumptions might be challenged in the real world. Technology is always progressing, the units of input are likely going to vary (hiring one person compared to another person will have different impacts) and even the questions of measurement will be more complex beyond the narrow assessment of weight or financial value.
It relies on a static, predictable system which is rarely true or at least has clear limitations when applied to the complexity of reality.
Too Many Cooks.
A useful example to explain this model is to consider a small food truck that sells doughnuts. If that truck has one cook, they might be able to produce 20 doughnuts every hour. Adding one more cook might increase that output to 40 doughnuts every hour. However, adding a third cook might only allow them to produce 45 doughnuts every hour because of the limited space and resources in the truck, and adding a fourth cook might not add any returns at all.
d
The concept of Diminishing Returns has a rich and long history, being traced back to economists such as Adam Smith, Jacques Turgot, and Thomas Mathus. The earliest explicit references to this model were in relation to farming outputs and can be attributed to Thomas Malthus and David Ricardo.
My Notes
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