In response to Robin Neill's query about how economists explain decreasing and increasing returns when all inputs are variable, may I suggest Bela Gold's article, "Changing Perspectives on Size, Scale and returns: An Interpretive Survey," in the _Journal of Economic Literature_, XIX (March 1981), 5-33. In an article that I wrote with Sidney Carroll on "Alfred Chandler's Speed: Monetary Transformation," (_Business and Economic History_, Vol. 22, no. 1, Fall 1993) we summarized Gold's argument in these words: "Gold provides extensive documentation in support of the argument also advanced by Armen Alchian, that what are usually called economies of scale are in reality economies associated with different techniques of production and with different factor proportion. Gold finds little evidence that larger duplicates of smaller plants that are otherwise identical in all other important respects do, in fact, produce at lower cost. He describes the long struggle in economic thought to preserve the idea that size is cause, rather than consequence, of cost reducing changes in production, and he concludes that at least two concepts of scale economies have coexisted. The 'restrictive' theoretical concept attributes scale economies to size and holds all else constant, technology as well as factor proportions. The 'observational' concept attributes scale-related cost reductions to changes in (among other things) technology, factor proportions, and organization of production." It is my impression that the distinction is not made clear in most introductory, or for that matter, intermediate or advanced courses. Anne Mayhew