Does Microelectronics Reduce Economies of Scale? A Case Study in the Turkish Chemical Industry

Abstract

This paper delves into the question of how new technologies affect economies of scale at the empirical level. As theoretical studies are inconclusive, we introduce a case study in the Turkish chemical industry to observe the dynamics of the relationship between technology and economies of scale. By observing the changes in the sources of economies of scale, output and unit costs in our case study firms, we showed that while economies of product scale stayed stable, both economies of plant and firm scales increased in the chemical industry.