what is the law of diminishing marginal productivity 
the law of diminishing marginal productivity is an economic principle usually considered by managers in productivity management generally it states that increasing an input in a production process for example labor hours will result in marginally smaller increases in output after the initial increase and may level off or even decrease after a specific point understanding the law of diminishing marginal productivitythe law of diminishing marginal productivity involves marginal increases in production resulting from an increase of an input employed it can also be known as the law of diminishing returns in general it aligns with most economic theories using marginal analysis such as the diminishing rate of satisfaction or utility obtained from additional units of consumption of a particular commodity the law of diminishing marginal productivity suggests that managers find a marginally diminishing rate of production per unit of an input employed in the production process if all other things remain the same when mathematically graphed this shows total production increasing at a decreasing rate as increasing units of an input are added to the production process different than some other economic laws the law of diminishing marginal productivity involves marginal product calculations that can usually be relatively easy to quantify companies may choose to alter various inputs in the factors of production for various reasons many of which are focused on costs in some situations it may be more cost efficient to alter the inputs of one variable while keeping others constant however in practice all changes to input variables require close analysis the law of diminishing marginal productivity says that these changes to inputs will have a marginally positive effect on outputs thus each additional unit produced will report a marginally smaller production return than the unit before it as production goes on the law of diminishing marginal productivity is also known as the law of diminishing marginal returns marginal productivity or marginal product refers to the extra output return or profit yielded per unit by advantages from production inputs inputs can include things like labor and raw materials the law of diminishing marginal returns states that when an advantage is gained in a factor of production the marginal productivity will typically diminish as production increases this means that the cost advantage usually diminishes for each additional unit of output produced 