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Samuelson Condition
The Samuelson condition, authored by Paul Samuelson,Samuelson, Paul A. (1954), The Theory of Public Expenditure, in: Review of Economics and Statistics 36, pp. 386–389. in the theory of public goods in economics, is a condition for the efficient provision of public goods. When satisfied, the Samuelson condition implies that further substituting public for private goods (or vice versa) would result in a decrease of social utility. For an economy with ''n'' consumers the conditions reads as follows: : \sum_^n \text_i = \text MRS''i'' is individual ''i'' marginal rate of substitution and MRT is the economy'marginal rate of transformationbetween the public good and an arbitrarily chosen private good. If the private good is a numeraire good then the Samuelson condition can be re-written as: : \sum_^n \text_i = \text where \text_i is the marginal benefit to each person of consuming one more unit of the public good, and MC is the marginal cost of providing that good. In o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Paul Samuelson
Paul Anthony Samuelson (May 15, 1915 – December 13, 2009) was an American economist who was the first American to win the Nobel Memorial Prize in Economic Sciences. When awarding the prize in 1970, the Swedish Royal Academies stated that he "has done more than any other contemporary economist to raise the level of scientific analysis in economic theory". "In a career that spanned seven decades, he transformed his field, influenced millions of students and turned MIT into an economics powerhouse" Economic historian Randall E. Parker has called him the "Father of Modern Economics", and ''The New York Times'' considers him to be the "foremost academic economist of the 20th century". Samuelson was likely the most influential economist of the latter half of the 20th century."Paul ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Public Good (economics)
In economics, a public good (also referred to as a social good or collective good)Oakland, W. H. (1987). Theory of public goods. In Handbook of public economics (Vol. 2, pp. 485-535). Elsevier. is a good that is both non-excludable and non-rivalrous. For such goods, users cannot be barred from accessing or using them for failing to pay for them. Also, use by one person neither prevents access of other people nor does it reduce availability to others. Therefore, the good can be used simultaneously by more than one person. This is in contrast to a common good, such as wild fish stocks in the ocean, which is non-excludable but rivalrous to a certain degree. If too many fish were harvested, the stocks would deplete, limiting the access of fish for others. A public good must be valuable to more than one user, otherwise, the fact that it can be used simultaneously by more than one person would be economically irrelevant. Capital goods may be used to produce public goods or services th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economics
Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interactions of Agent (economics), economic agents and how economy, economies work. Microeconomics analyzes what's viewed as basic elements in the economy, including individual agents and market (economics), markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it: employment of the resources of labour, capital, and land, currency inflation, economic growth, and public policies that have impact on glossary of economics, these elements. Other broad distinctions within economics include those between positive economics, desc ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utility
As a topic of economics, utility is used to model worth or value. Its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or happiness as part of the theory of utilitarianism by moral philosophers such as Jeremy Bentham and John Stuart Mill. The term has been adapted and reapplied within neoclassical economics, which dominates modern economic theory, as a utility function that represents a single consumer's preference ordering over a choice set but is not comparable across consumers. This concept of utility is personal and based on choice rather than on pleasure received, and so is specified more rigorously than the original concept but makes it less useful (and controversial) for ethical decisions. Utility function Consider a set of alternatives among which a person can make a preference ordering. The utility obtained from these alternatives is an unknown function of the utilities obtained from each alternative, not the sum of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Marginal Rate Of Substitution
In economics, the marginal rate of substitution (MRS) is the rate at which a consumer can give up some amount of one good in exchange for another good while maintaining the same level of utility. At equilibrium consumption levels (assuming no externalities), marginal rates of substitution are identical. The marginal rate of substitution is one of the three factors from marginal productivity, the others being marginal rates of transformation and marginal productivity of a factor. As the slope of indifference curve Under the standard assumption of neoclassical economics that goods and services are continuously divisible, the marginal rates of substitution will be the same regardless of the direction of exchange, and will correspond to the slope of an indifference curve (more precisely, to the slope multiplied by −1) passing through the consumption bundle in question, at that point: mathematically, it is the implicit derivative. MRS of X for Y is the amount of Y which a consumer ca ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Samuelson Condition
The Samuelson condition, authored by Paul Samuelson,Samuelson, Paul A. (1954), The Theory of Public Expenditure, in: Review of Economics and Statistics 36, pp. 386–389. in the theory of public goods in economics, is a condition for the efficient provision of public goods. When satisfied, the Samuelson condition implies that further substituting public for private goods (or vice versa) would result in a decrease of social utility. For an economy with ''n'' consumers the conditions reads as follows: : \sum_^n \text_i = \text MRS''i'' is individual ''i'' marginal rate of substitution and MRT is the economy'marginal rate of transformationbetween the public good and an arbitrarily chosen private good. If the private good is a numeraire good then the Samuelson condition can be re-written as: : \sum_^n \text_i = \text where \text_i is the marginal benefit to each person of consuming one more unit of the public good, and MC is the marginal cost of providing that good. In o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Lindahl Equilibrium
A Lindahl tax is a form of taxation conceived by Erik Lindahl in which individuals pay for public goods according to their marginal benefits. In other words, they pay according to the amount of satisfaction or utility they derive from the consumption of an additional unit of the public good. Lindahl taxation is designed to maximize efficiency for each individual and provide the optimal level of a public good. Lindahl taxes can be seen as an individual's share of the collective tax burden of an economy. The optimal level of a public good is that quantity at which the willingness to pay for one more unit of the good, taken in totality for all the individuals is equal to the marginal cost of supplying that good. Lindahl tax is the optimal quantity times the willingness to pay for one more unit of that good at this quantity. [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
