A continuing series for the gravitationally impaired.
Statement of unknown origin, but widely used and believed, and often repeated; "The cost of a rocket goes up exponentially with the number of stages." I hear this nearly every time when presenting Minimum Cost Design launch vehicle projects. And, I suppose that it is true for the person who originally stated it, probably a NASA bureaucrat. The effect of using multiple stages on launch vehicle cost can be represented by the formula; Cost = X (to the n), where X is the number of stages, and n is the inefficiency of the launch organization. For NASA every new stage means, a new contractor, another oversight contractor, another auditing contractor, more environmental studies, new technology development programs, stage interface committees at each end of the stage, and lots of consultants. All a good recipe for exponential cost growth.
It's sort of like walking a dog. One is an easy enjoyable walk, two is much, much more difficult, three or more is a nightmare! However, it should be remembered that an Innuit, (Eskimo), can easily handle twenty half wild sled dogs in almost impossible conditions. He is very good with a whip, and does not allow middle managers to come between him and the dogs.
Commercial organizations don't need all that bureaucracy, and they can fire people. They can take of the two great advantages of staging, a smaller vehicle, and lower technology level.
The Soviets used multistage vehicles often, but kept the cost down by using common technologies for most stages, and working a small number of people very hard. The Soviet manned vehicle Vostok was a two and a half stage system, while the U.S. Mercury / Atlas was a one and a half stage vehicle.