#3 One of the most powerful concepts about knowledge economy is the law of increasing returns. Discuss what this concept means to a company or any organization.

The law of increasing returns suggests that for each additional variable input added the output will be disproportionately higher. This is the opposite of the law of diminishing returns that states that at some point for every additional unit input the additional output will become less and less.  The law of diminishing returns is a more widely accepted and almost universal understanding, however the law of increasing returns is especially important in terms of technology.

A system striving to fulfill the law of increasing returns would be a system that, when another variable is added,  demonstrates a higher output. Technology gives businesses the ability to network job stations, thus increasing productivity and profitability.  If an organization can successfully use the knowledge systems that are available to them, the law of increasing returns can become more fact than fiction or myth.  The ability to remain technologically innovative and competitive in a free market economy directly relates to the law of increasing returns, such that the law of increasing returns will remain evident if technology is continually refined and streamlined.