In a message dated 97-11-15 22:49:56 EST, you write:
<< There are virtually no industries in which a market share
>greater than 10% of the U.S. market is required to exhaust all scale
>economies--to reach the lowest (technologically) attainable cost per unit.
>>
Calculating "EOS's" is a real tricky business. In manufacturing it may be
relatively "easy." One of the problem with services is how to measure
"output." Moreover, most use NC concepts which assume smooth NC curves -
Sraffa and others would have objected tothis form of the problem.
Unfortunately, consulting (esp accounting) firms have been trying to
rationalize all of American industry according to MC cost theory. For
example, hospitals have contracted with accounting firms to estimate EOS;
however, allocating "overhead" (e.g. radiology) to an appropriate "product
line" (e.g. obstetrics) is a major nightmare. Is anyone selling Oxford
short?
Jason
