In economics, output elasticity is the percentage change of output (GDP or production of a single firm) divided by the percentage change of an input.
It is sometimes called partial output elasticity to clarify that it refers to the change of only one input.
If the production function contains only one input, then the output elasticity is also an indicator of the degree of returns to scale.
If the coefficient of output elasticity is greater than 1, then production is experiencing increasing returns to scale.
[3] The coefficient of output elasticity can be used to estimate returns to scale.