SUMMARY / RELATED TOPICS

Economies of scale

In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale. At the basis of economies of scale there may be technical, organizational or related factors to the degree of market control. Economies of scale apply to a variety of organizational and business situations and at various levels, such as a production, plant or an entire enterprise; when average costs start falling as output increases economies of scale occur. Some economies of scale, such as capital cost of manufacturing facilities and friction loss of transportation and industrial equipment, have a physical or engineering basis. Another source of scale economies is the possibility of purchasing inputs at a lower per-unit cost when they are purchased in large quantities; the economic concept dates back to Adam Smith and the idea of obtaining larger production returns through the use of division of labor. Diseconomies of scale are the opposite.

Economies of scale have limits, such as passing the optimum design point where costs per additional unit begin to increase. Common limits include exceeding the nearby raw material supply, such as wood in the lumber and paper industry. A common limit for a low cost per unit weight commodities is saturating the regional market, thus having to ship product uneconomic distances. Other limits include having a higher defect rate. Large producers are efficient at long runs of a product grade and find it costly to switch grades frequently, they will, avoid specialty grades though they have higher margins. Smaller manufacturing facilities remain viable by changing from commodity-grade production to specialty products. Economies of scale must be distinguished by economies stemming from an increase in the production of a given plant; when a plant is used below its optimal production capacity, increases in its degree of utilization bring about decreases in the total average cost of production. As noticed, among the others, by Nicholas Georgescu-Roegen and Nicholas Kaldor these economies cost are not economies of scale.

The simple meaning of economies of scale is doing things more efficiently with increasing size. Common sources of economies of scale are purchasing, financial and technological; each of these factors reduces the long run average costs of production by shifting the short-run average total cost curve down and to the right. Economies of scale is a concept that may explain real-world phenomena such as patterns of international trade or the number of firms in a market; the exploitation of economies of scale helps explain. It is a justification for free trade policies, since some economies of scale may require a larger market than is possible within a particular country—for example, it would not be efficient for Liechtenstein to have its own carmaker if they only sold to their local market. A lone carmaker may be profitable, but more so if they exported cars to global markets in addition to selling to the local market. Economies of scale play a role in a "natural monopoly". There is a distinction between two types of economies of scale: external.

An industry that exhibits an internal economy of scale is one where the costs of production fall when the number of firms in the industry drops, but the remaining firms increase their production to match previous levels. Conversely, an industry exhibits an external economy of scale when costs drop due to the introduction of more firms, thus allowing for more efficient use of specialized services and machinery; some of the economies of scale recognized in engineering have a physical basis, such as the square-cube law, by which the surface of a vessel increases by the square of the dimensions while the volume increases by the cube. This law has a direct effect on the capital cost of such things as buildings, pipelines and airplanes. In structural engineering, the strength of beams increases with the cube of the thickness. Drag loss of vehicles like aircraft or ships increases less than proportional with increasing cargo volume, although the physical details can be quite complicated. Therefore, making them larger results in less fuel consumption per ton of cargo at a given speed.

Heat loss from industrial processes vary per unit of volume for pipes and other vessels in a relationship somewhat similar to the square-cube law. In some productions, an increase in the size of the plant reduces the average variable cost, thanks to the energy savings resulting from the lower dispersion of heat. Economies of increased dimension are misinterpreted because of the confusion between indivisibility and three-dimensionality of space; this confusion arises from the fact that three-dimensional production elements, such as pipes and ovens, once installed and operating, are always technically indivisible. However, the economies of scale due to the increase in size do not depend on indivisibility but on the three-dimensionality of space. Indeed, indivisibility only entails the existence of economies of scale produced by the balancing of productive capacities, considered above.

J. Harwood Cochrane

James Harwood Cochrane was an American businessman and philanthropist, as well as inductee into the Automotive Hall of Fame. Cochrane and his six brothers and sisters grew up in humble circumstances, their rural Goochland County home lacked central heating. His father died of pneumonia when Harwood was 16 years old, his mother ran a soup kitchen in Richmond, Virginia, he met his future wife of eight decades, Louise Odell Banks, on a blind date and they wed in the parlor of the pastor of Tabernacle Baptist Church in 1934. His mother fixed their wedding dinner, their honeymoon was a movie at the Loew's theater in downtown Richmond. Harwood and Louise celebrated their 80th anniversary at the same location, although the location had become the Carpenter Theater, their 1000 guests listened to Steven Smith conduct the Richmond Symphony Women's Chorus, Richmond Ballet and various soloists. In 1929, the teenaged Cochrane quit Goochland High School and began delivering milk for the Virginia Dairy Company, Incorporated.

He long remembered those years of starting work shortly before 2 a.m. He, his brother Calvin and Charlie the Horse were "Cochrane Transportation." The brothers established separate trucking companies in 1933. In 1935, despite the Great Depression and having married Louise only about a year earlier, Cochrane quit the part-time dairy delivery job and formed Overnite Transportation; the name arose because a Baltimore company was called "Overnight Transportation." Cochrane told tales of eating frugally on the road, sometimes pawning his watch or other items to buy gasoline to return home, for nine months in 1934 driving a truck lacking both brakes and fourth gear. Overnite Trucking nonetheless grew both internally and by acquiring other trucking companies, it relied on establishing a system of terminals to facilitate short-haul deliveries. The development of the Interstate Highway System helped business, the Interstate Commerce Commission began regulating the industry in 1935. Overnite Trucking's stock became publicly traded in 1957 despite a bruising unionization effort by the International Brotherhood of Teamsters.

Cochrane treasured a copy of the $359,000 check written in 1963 by Teamsters president Jimmy Hoffa to Overnite to settle a legal judgment against the Union. By 1986, the company which began with a tractor, a trailer, a straight truck and two part-time drivers had become large enough that the Union Pacific Corporation offered to buy it. Though Cochrane demurred, he sold it for $1.2 billion. Many of his employees, who had received stock became wealthy. Cochrane remained as Overnite's CEO until 1991. Union Pacific spun Overnite off in 2003, in 2005 United Parcel Service bought it for $1.25 billion. It is now the country's fifth largest less-than-load carrier. In 1991 Cochrane both was inducted into the Automotive Hall of Fame for building Overnite, as well as started Highway Express Inc. a full-load trucking company based near Overnite's terminal on the Midlothian Turnpike. He sold Highway Express in 2003 to the Celadon Group and with his wife Louise concentrated on philanthropic activities, they become major philanthropists of their home town.

Rockville, Virginia named its library after the Cochranes, who donated $1 million to the American Red Cross to provide relief after Hurricane Katrina. Richmond cultural institutions that they both visited and donated to included: the Virginia Museum of Fine Arts, Richmond Ballet, Richmond Symphony, Lewis Ginter Botanical Garden and Virginia Opera, they made donations to their Tabernacle Baptist Church and numerous Baptist causes, including the Baptist Theological Seminary at Richmond, well-digging efforts in Africa and $8 million to the Southern Baptist International Mission Board ended up writing it out of his will, displeased with increasing fundamentalism). Cochrane died within a year of his beloved wife of Louise, they are survived by their son James Harwood Cochrane Jr. and daughter Judith Cochrane Gilman-Hines, as well as numerous grandchildren and great-grandchildren, one of whom shared a birthday with Louise. Their daughter Suzanne Hope Cochrane Austell Martin died in 2009 and another daughter Treena died as an infant

York South—Weston (provincial electoral district)

York South—Weston is a provincial electoral district in Toronto, Canada, represented in the Legislative Assembly of Ontario since 1999. Its Member of Provincial Parliament is New Democrat Faisal Hassan, it is in the west-end of Toronto. The riding has a working class and immigrant population; the riding is made up of the old City of York, a southwestern portion of the old city of North York, parts of the old city of Toronto north of High Park. It consists of the part of the City of Toronto bounded by a line drawn from Humber River east along Highway 401, south along the Canadian National Railway situated west of Caledonia Road, west along Rogers Road, southeast along Old Weston Road, west along Lavender Road, south along Keele Street, southeast along the Canadian National/Canadian Pacific Railway, west along the Canadian Pacific Railway, north along the Humber River to Highway 401; the provincial electoral district was created in 1999 when provincial ridings were defined to have the same borders as federal ridings.

Prior to that redistribution, the area included York South and parts of what are now Parkdale-High Park and Eglinton-Lawrence. They became law after Bill 214, otherwise known as the "Representations Act, 2005",was passed in the Ontario Legislature; the October 10, 2007 provincial election was conducted using the new boundaries, with only minor changes to the boundaries in the south-east corner of the riding, along the border with the Davenport riding. York South—Weston consisting of those parts of the cities of North York and York described as follows: commencing at the intersection of the westerly limit of the City of North York with the Macdonald-Cartier Freeway. Elections Ontario Past Election Results Map of riding for 2018 election