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World Applied Sciences Journal 27 (Economics, Management and Finance): 125-129, 2013 ISSN 1818-4952 © IDOSI Publications, 2013 DOI: 10.5829/idosi.wasj.2013.27.emf.26 Transformation of the Resource Scarcity Principle in Increasing Return Economics I.A. Kirshin Kazan (Volga Region) Federal University, Kazan, Russia Submitted: Oct 17, 2013; Accepted: Dec 12, 2013; Published: Dec 15, 2013 Abstract: This article deals with the peculiarities of functioning of increasing return economics and reasons the necessity to modify the resource scarcity principle as applied to the research of the subject matter of economic processes with increasing return. Modelling the results of reallocation of a common resource among alternative productions in the increasing return economics, the author determines constraints of the law of increasing relative costs. Key words: Resource scarcity Increasing return Efficiency INTRODUCTION signs of unbalanced forces, as a motion away from equilibrium and from the previous path of economic The foundation for the modern increasing dynamics. returns theory was laid by using the increasing Later on, K. Arrow reasoned the provision, according return principle. The economic mechanism of the to which, the production becomes more efficient along latter can be demonstrated by a model with positive with the general growth of products output, because the fee