The inflection point for diminishing returns appears to be the PS3/360 generation

[Jay520]

theprof00 said:

Picture it like an overlap.

Quality marked with Q's

PS2-QQQQQQQQ------------------------------------
PS3--------------QQQQQQQQQQ------------------
PS4------------------------------QQQQQQQQQQQ

horizontal axis is from lower to higher graphical quality

I'd say it's like this (based on human perception, of course):

PS2-QQQQQQQQ------------------------------------
PS3--------------QQQQQQQQQQ-------------------
PS4------------------QQQQQQQQQq---------------