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competitive process (Ll)<br />A process consisting of two opposing tendencies: the transfer mechanism which reallocates the market shares of the less efficient firms to the more efficient and the INNOVATION mechanism which enables firms lagging behind their competitors to introduce new products or processes to reassert their position in a market.<br /> <br /><em>Reference</em><br />Downie, J. (1958) The Competitive Process, London: Duckworth.
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external economy of scale (DO)<br />A reduction in the AVERAGE COSTS of a firm as a result of the expansion of the whole industry of which it is part. A major example of these economies occurs in the case of the training of labour: the general expansion of an industry requires more skilled labour to provide a pool of suitable labour for other firms.<br /><em>See also:</em> internal economy of scale
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