Saturday, September 8, 2018

Destructive Invention a tool for Economics of Scale


Economies of Scale:

Economies of Scale refers to when the increase in quantity of the production is inversely proportional to the cost of production which acts as an advantage for producers.

In 5th century B.C. Aluminium was extracted from alum salt. Later the discovery of the metal ore bauxite by Danish physicist Hans Christian Ørsted in the Year 1825 gave a new standard of extraction. But sooner Aluminium was much more expensive than Gold because of its expensive process of extraction.

Then came Carl Joseph Bayer, in the year 1889 from Austria, whose process of extraction of this metal revolutionized the world. And this process is still used in the Industries.

This destructive invention of Bayer’s Method brought an economies of scale to the production of Aluminium so much, that Germany is at the top with respect to 43kg as the Average Per capita consumption of Aluminium in 2017.

Sources:



Shifting Aluminium Consumption Habits in India:


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