Zero Marginal Cost

Home/Zero Marginal Cost

Zero marginal cost is a term coined by Jeremy Rifkin which refers to the capacity to produce new products and add value at no extra cost per added unit, due to the advent of information technology and new economic models of the sharing and circular economy. Marginal cost is a central structure to industrial age capitalism, which is built around the idea that it costs something to produce value. However, information technology through its capacity for rapid, low-cost duplication and exchange makes it ever easier to duplicate information and distribute it at zero marginal cost. Coupled to this are the ideas of sustainability and the sharing economy that promote the reuse, recycling and sharing of excess capacity, all of which unlock value at virtually zero cost by reducing waste. With this new economic paradigm, we are now creating value at a very low input of resources, i.e. close to zero marginal cost.

2016-10-15T09:43:11+00:00