Constant returns to scale will hold when a proportional enlarge in all the factors of production leads to an equal proportional increase in the output. For example, if both labour and capital are increased by 10% and if the output also increases by 10% , then we say that the production function evince constant returns to scale.

Algebraically, sustained returns to scale exists when f (nL ,nK)= n f (L,K)

This implies that if both labour and capital are increased by ' n ' times, then the production also increases by ' n ' times. In other words, constant returns to scale occur when increasing the number of inputs lead to an equivalent increase in the output.