experience curve

[Shah Alam Kabir Pramanik]

experience curve
A conceptual framework that many large corporations have used successfully is
the experience curve (originally called the learning curve).
As it applies to manufacturing , the experience curve concept holds that unit production costs decline by some fixed percentage (commonly 20%-30%) each time the total accumulated volume of production (in units) doubles.
Graph that depicts the 'experience effect' (increases in productivity) as reflected in reduced average and marginal costs. Unlike the learning curve, an experience curve takes into account both fixed and variable costs