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Market Clearing
In economics, market clearing is the process by which, in an economic market, the supply of whatever is traded is equated to the demand so that there is no excess supply or demand. The new classical economics assumes that in any given market, assuming that all buyers and sellers have access to information and that there is no "friction" impeding price changes, prices ''always'' adjust up or down to ensure market clearing. Mechanism and examples A market-clearing price is the price of a good or service at which quantity supplied is equal to quantity demanded, also called the equilibrium price. The theory claims that markets tend to move toward this price. For a one-time sale of goods, supply is fixed, so the market-clearing price is simply the maximum price at which all items can be sold. For a market where goods are produced and sold on an ongoing basis, the theory predicts that the market will move toward a price where the quantity supplied in a broad time period will equal the qua ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Sales Poznan 2011
Sales are activities related to selling or the number of goods sold in a given targeted time period. The delivery of a service for a cost is also considered a sale. The seller, or the provider of the goods or services, completes a sale in response to an acquisition, appropriation, requisition, or a direct interaction with the ''buyer'' at the point of sale. There is a passing of title (property or ownership) of the item, and the settlement of a price, in which agreement is reached on a price for which transfer of ownership of the item will occur. The ''seller'', not the purchaser, typically executes the sale and it may be completed prior to the obligation of payment. In the case of indirect interaction, a person who sells goods or service on behalf of the owner is known as a salesman or saleswoman or salesperson, but this often refers to someone selling goods in a store/shop, in which case other terms are also common, including ''salesclerk'', ''shop assistant'', and ''ret ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
New Keynesian Economics
New Keynesian economics is a school of macroeconomics that strives to provide microfoundations, microeconomic foundations for Keynesian economics. It developed partly as a response to criticisms of Keynesian macroeconomics by adherents of new classical macroeconomics. Two main assumptions define the New Keynesian approach to macroeconomics. Like the New Classical approach, New Keynesian macroeconomic analysis usually assumes that households and firms have rational expectations. However, the two schools differ in that New Keynesian analysis usually assumes a variety of market failures. In particular, New Keynesians assume that there is imperfect competition in price and wage setting to help explain why prices and wages can become "Sticky (economics), sticky", which means they do not adjust instantaneously to changes in economic conditions. Wage and price stickiness, and the other market failures present in New Keynesian Model (macroeconomics), models, imply that the economy may ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Double Auction
A double auction is a process of buying and selling goods with multiple sellers and multiple buyers. Potential buyers submit their bids and potential sellers submit their ask prices to the market institution, and then the market institution chooses some price ''p'' that clears the market: all the sellers who asked less than ''p'' sell and all buyers who bid more than ''p'' buy at this price ''p''. Buyers and sellers that bid or ask for exactly ''p'' are also included. A common example of a double auction is stock exchange. As well as their direct interest, double auctions are reminiscent of Walrasian auction and have been used as a tool to study the determination of prices in ordinary markets. A double auction is also possible without any exchange of currency in barter trade. A barter double auction is an auction where every participant has a demand and an offer consisting of multiple attributes and no money is involved. For the mathematical modelling of satisfaction level Euclid ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Endogeneity (econometrics)
In econometrics, endogeneity broadly refers to situations in which an explanatory variable is correlated with the error term. The distinction between endogenous and exogenous variables originated in simultaneous equations models, where one separates variables whose values are determined by the model from variables which are predetermined; ignoring simultaneity in the estimation leads to biased estimates as it violates the exogeneity assumption of the Gauss–Markov theorem. The problem of endogeneity is often ignored by researchers conducting non-experimental research and doing so precludes making policy recommendations. Instrumental variable techniques are commonly used to address this problem. Besides simultaneity, correlation between explanatory variables and the error term can arise when an unobserved or omitted variable is confounding both independent and dependent variables, or when independent variables are measured with error. Exogeneity versus endogeneity In a sto ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Efficiency Wage
The term efficiency wages (or rather "efficiency earnings") was introduced by Alfred Marshall to denote the wage per efficiency unit of labor. Marshallian efficiency wages would make employers pay different wages to workers who are of different efficiencies such that the employer would be indifferent between more-efficient workers and less-efficient workers. The modern use of the term is quite different and refers to the idea that higher wages may increase the efficiency of the workers by various channels, making it worthwhile for the employers to offer wages that exceed a market-clearing level. Optimal efficiency wage is achieved when the marginal cost of an increase in wages is equal to the marginal benefit of improved productivity to an employer.Mankiw, Gregory N. & Taylor, Mark P. (2008), ''Macroeconomics'' (European edition), pp. 181–182 In labor economics, the "efficiency wage" hypothesis argues that wages, at least in some labour markets, form in a way that is not m ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Full Employment
Full employment is a situation in which there is no cyclical or unemployment#Cyclical unemployment, deficient-demand unemployment. Full employment does not entail the disappearance of all unemployment, as other kinds of unemployment, namely Structural unemployment, structural and Frictional unemployment, frictional, may remain. For instance, workers who are "between jobs" for short periods of time as they search for better employment are not counted against full employment, as such unemployment is frictional rather than cyclical. An economy with full employment might also have unemployment or underemployment where part-time workers cannot find jobs appropriate to their skill level, as such unemployment is considered structural rather than cyclical. Full employment marks the point past which expansionary fiscal and/or monetary policy cannot reduce unemployment any further without causing inflation. Some economists define full employment somewhat differently, as the unemployment rate ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Path Dependence
Path dependence is a concept in economics and the social sciences, referring to processes where past events or decisions constrain later events or decisions. It can be used to refer to outcomes at a single point in time or to long-run equilibria of a process. Path dependence has been used to describe institutions, technical standards, patterns of economic or social development, organizational behavior, and more. In common usage, the phrase can imply two types of claims. The first is the broad concept that "history matters", often articulated to challenge explanations that pay insufficient attention to historical factors. This claim can be formulated simply as "the future development of an economic system is affected by the path it has traced out in the past" or "particular events in the past can have crucial effects in the future." The second is a more specific claim about how past events or decisions affect future events or decisions in significant or disproportionate ways, throu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Gross Domestic Product
Gross domestic product (GDP) is a money, monetary Measurement in economics, measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is often revised before being considered a reliable indicator. List of countries by GDP (nominal) per capita, GDP (nominal) per capita does not, however, reflect differences in the cost of living and the inflation, inflation rates of the countries; therefore, using a basis of List of countries by GDP (PPP) per capita, GDP per capita at purchasing power parity (PPP) may be more useful when comparing standard of living, living standards between nations, while nominal GDP is more useful comparing national economies on the international market. Total GDP can also be broken down into the contribution of each industry or sector of the economy. The ratio of GDP to the total population of the region is the GDP per capita, p ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Real Versus Nominal Value (economics)
In economics, nominal value is measured in terms of money, whereas real value is measured against goods or services. A real value is one which has been adjusted for inflation, enabling comparison of quantities as if the prices of goods had not changed on average; therefore, changes in real value exclude the effect of inflation. In contrast, a nominal value has not been adjusted for inflation, and so changes in nominal value reflect at least in part the effect of inflation but will not hold the same purchasing power. Commodity bundles, price indices and inflation A commodity bundle is a sample of goods, which is used to represent the sum total of goods across the economy to which the goods belong, for the purpose of comparison across different times (or locations). At a single point of time, a commodity bundle consists of a list of goods, and each good in the list has a market price and a quantity. The market value of the good is the market price times the quantity at that poin ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economic Growth
Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate of increase in the real gross domestic product, or real GDP. Growth is usually calculated in real terms – i.e., inflation-adjusted terms – to eliminate the distorting effect of inflation on the prices of goods produced. Measurement of economic growth uses national income accounting. Since economic growth is measured as the annual percent change of gross domestic product (GDP), it has all the advantages and drawbacks of that measure. The economic growth-rates of countries are commonly compared using the ratio of the GDP to population (per-capita income). The "rate of economic growth" refers to the geometric annual rate of growth in GDP between the first and the last year over a period of time. This growth rate represents the trend in ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Flexible Prices
Flexible may refer to: Science and technology * Power cord, a flexible electrical cable. ** Flexible cable, an Electrical cable as used on electrical appliances * Flexible electronics * Flexible response * Flexible-fuel vehicle * Flexible rake receiver * Flexible AC transmission system * Semi-flexible rod polymer * Flexible algebra, in non-associative algebras, for example alternative algebras * Flexible polyhedron * Flexible single master operation Other uses * "Flexible", a song by Depeche Mode * Flexible mold * Flextime, a variable work schedule * Flexible spending account, a tax-advantaged savings account * Flexible baton round, fired as a shotgun shell * Flxible, originally the Flexible Sidecar Co. See also * Flexibility (other) * Bendable (other) * Rollable (other) Roll or Rolls may refer to: Movement about the longitudinal axis * Roll angle (or roll rotation), one of the 3 angular degrees of freedom of any stiff body (for example a vehicle), d ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Debt Deflation
Debt deflation is a theory that recessions and depressions are due to the overall level of debt rising in real value because of deflation, causing people to default on their consumer loans and mortgages. Bank assets fall because of the defaults and because the value of their collateral falls, leading to a surge in bank insolvencies, a reduction in lending and by extension, a reduction in spending. The theory was developed by Irving Fisher following the Wall Street Crash of 1929 and the ensuing Great Depression. The debt deflation theory was familiar to John Maynard Keynes prior to Fisher's discussion of it, but he found it lacking in comparison to what would become his theory of liquidity preference. The theory, however, has enjoyed a resurgence of interest since the 1980s, both in mainstream economics and in the heterodox school of post-Keynesian economics, and has subsequently been developed by such post-Keynesian economists as Hyman Minsky and by the neo-classical mainstream ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
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