Increasing returns and economic progress revisited

It is hypothesised that the phenomenon of increasing returns and economic progress may only be consistently explained by employing the epistemological paradox, that where knowledge is part of the system, knowledge about the system necessarily and inescapably changes the system itself. Accordingly, one expects to find the principle of increasing returns embodied in the theoretical writing about increasing returns. This is shown by an exemplary reading of the works of Young and Penrose.