it has been suggested that learning effects are important only during the start-up period of a new process and that they cease after two or three years. any decline in the experience curve after such a point is due to

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Any decline in the experience curve after such a point is due to economies of scale.

The cost advantages that businesses experience as a result of their size of operation are known as economies of scale, and they are often quantified by the amount of output generated in a given amount of time. An expansion in scale is made possible by a drop in the cost per unit of output.

Economies of scale are a phenomenon in which the average cost per unit of output falls as the scale or volume of the output generated by a firm rises. Because their per-unit expenses are lower as a percentage of their overall size, economies of scale provide larger businesses a competitive edge over smaller ones.

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