Alibaba started in an apartment and is now the world’s largest retailer. Amazon started as an online book seller, and eBay began as a site where people could sell used personal items in auctions. Did these online giants grow due to economies of scale, economies of scope, both, or neither? Are there any clouds on the horizon for these firms — could they face diseconomies of scale or diseconomies of scope as they continue to grow? If so, what factors may limit their continued growth?
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