View source for Glossary of economics

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This '''glossary of economics''' is a list of definitions containing terms and concepts used in economics, its sub-disciplines, and related fields.

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{{Economics sidebar}}

== A ==
{{glossary}}
{{term|[[absolute advantage]]}}
{{ghat|Also called '''resource cost advantage'''.}}
{{defn|The ability of a party (whether an individual, firm, or country) to produce a greater quantity of a good, product, or service than competitors using the same amount of resources.}}

{{term|[[Absorption (economics)|absorption]]}}
{{defn|The total demand for all [[final good|final]] marketed [[goods and services]] by all [[Agent (economics)|economic agent]]s resident in an economy, regardless of the origin of the goods and services themselves<ref>{{cite book |title=Terms of Trade: Glossary of International Economics |last=Deardorff |first=Alan V. |author-link=Alan Deardorff |year=2006 |publisher=World Scientific Publishing |location=Hackensack |isbn=978-981-256-603-4 }}</ref>}}

{{term|abandonment of the gold standard}}
{{defn|The decision by a government to abandon a {{gli|monetary system}} in which the standard economic {{gli|unit of account}} is based on a fixed quantity of gold.}}

{{term|[[accelerator effect]]}}
{{defn|A positive effect on private fixed investment because of the growth of the market economy. Rising GDP usually implies that profit expectations and business confidence rise, encouraging businesses to build more factories and other buildings and to install more machinery.}}

{{term|[[adaptive expectations]]}}
{{defn|A hypothetical process by which people form expectations about what will happen in the future based on what has happened in the past.}}

{{term|[[AD–AS model]]}}
{{defn|A macroeconomic model that explains price level and output through the relationship of downward-sloping aggregate demand (AD) and upward-sloping aggregate supply (AS).}}

{{term|[[AD–IA model]]}}
{{defn|A macroeconomic model that explains inflation and output through the relationship of downward-sloping aggregate demand (AD) and  horizontal inflation adjustment (IA). The monetary policy rule (MPR) is assumed, which is that the central bank increases interest rates in response to increase in inflation and vice versa.}}

{{term|[[adverse selection]]}}
{{defn|A market situation where buyers and sellers have different information, and participants with key information participate selectively in trades at the expense of other parties.}}

{{term|[[advertising elasticity of demand|advertising elasticity of demand (AED)]]}}
{{ghat|Also called '''advertising elasticity'''.}}
{{defn|Measures the sensitivity of a good's demand to a change in advertising.}}

{{term|[[agflation]]}}
{{ghat|Also called '''agrarian inflation'''.}}
{{defn|An increase in the price of food and industrial agricultural crops when compared to the general rise in prices.}}

{{anchor|aggregate demand}}{{term|[[aggregate demand]] (AD)}}
{{ghat|Also called '''domestic final demand (DFD)''' or '''effective demand'''.}}
{{defn|The total {{gli|demand}} for goods and services in an economy.<ref>{{cite book | title = Exploring Economics | first1 = Robert | last1 = Sexton | first2 = Peter | last2 = Fortura | isbn = 978-0-17-641482-5 | year = 2005 | publisher = Nelson Education Limited | quote = This is the sum of the demand for all final goods and services in the economy. It can also be seen as the quantity of real GDP demanded at different price levels. | url = https://archive.org/details/exploringeconomi0000sext }}</ref> It specifies the amounts of goods and services that will be purchased at all possible price levels.<ref>{{cite book| last = O'Sullivan| first = Arthur| author-link = Arthur O'Sullivan (economist) |author2= Steven M. Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2022| location = Paramus, New Jersey | pages = 307| url = https://www.savvas.com/index.cfm?locator=PS3jRm| isbn = 978-0-13-063085-8}}</ref> Aggregate demand can also be interpreted as the demand for the {{gli|gross domestic product}} of a country. It is often called {{gli|effective demand}}, though this term also has a distinct meaning.}}

{{anchor|aggregate supply}}{{term|[[aggregate supply]] (AS)}}
{{ghat|Also called '''domestic final supply (DFS)'''.}}
{{defn|The total {{gli|supply}} of goods and services in an economy.}}

{{term|[[aggregation problem]]}}
{{defn|The difficult problem of finding a valid way to treat an [[empirical]] or theoretical aggregate as if it reacted like a less-aggregated measure, say, about behavior of an individual {{gli|agent}} as described in general {{gli|microeconomics|microeconomic}} theory.<ref>Franklin M. Fisher  (1987).  "aggregation problem," ''[[The New Palgrave: A Dictionary of Economics]]'', v. 1, p. 54.  [Pp. 53–55.]</ref>}}

{{term|[[Agent (economics)|agent]]}}
{{defn|An actor or, more specifically, a [[decision maker]] in a {{gli|economic model|model}} of some aspect of the economy.}}

{{term|[[agricultural economics]]}}
{{defn|An applied field of {{gli|economics}} concerned with the application of economic theory in optimizing the production and distribution of food.}}

{{term|[[AK model]]}}
{{defn|A macroeconomic model that explains output through the relationship of [[total factor productivity]] and capital. It assumes that there is no diminishing return of capital.}}

{{term|[[Alchian–Allen effect]]}}
{{ghat|Also called the '''shipping the good apples out theorem''', or the '''third law of demand'''.}}
{{defn|When the prices of two substitute goods, such as high and low grades of the same product, are both increased by a fixed per-unit amount, consumption will shift toward the higher-grade product. This is because the added per-unit amount decreases the relative price of the higher-grade product.}}

{{term|[[Allais paradox]]}}
{{defn|A choice problem showing an inconsistency of actual observed choices with the independence axiom of expected utility theory.}}

{{term|[[allocative efficiency]]}}
{{defn|A state of the economy in which production represents consumer preferences; in particular, every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing. In the single-price model, at the point of allocative efficiency, price is equal to marginal cost.<ref>{{cite book | last = Markovits | first = Richard | title = Matters of Principle | publisher = [[New York University Press]] | location = New York City | year = 1998 | isbn = 978-0-8147-5513-6 }}</ref><ref>{{cite book | last = Markovits | first = Richard | title = Truth or Economics | publisher = [[Yale University Press]] | location = [[New Haven]] | year = 2008 | isbn = 978-0-300-11459-1 }}</ref>}}

{{term|[[alternative minimum tax]] (AMT)}}
{{defn|A tax imposed by the U.S. federal government in addition to the regular income tax for certain individuals, estates, and trusts. High-income taxpayers must calculate and pay the greater of the AMT or regular tax.<ref>[http://www.cbo.gov/ftpdocs/108xx/doc10800/01-15-AMT_Brief.pdf Calculating the Alternative Minimum Tax] Congressional Budget Office Economics and Budget Issue Brief, 2010, page 2. See Willis & Hoffman (2009) page __, and Pratt & Kulsrud (2010) Chapter 13.</ref>}}

{{term|[[ambiguity aversion]]}}
{{ghat|Also called '''uncertainty aversion'''.}}
{{defn|Any preference for known risks over unknown risks.}}

{{term|[[American School (economics)|American school]]}}
{{ghat|Also called the '''national system'''.}}
{{defn|A school of thought based around industry protection, government investment in infrastructure, and a national bank.}}

{{term|[[Amoroso–Robinson relation]]}}
{{defn|An equation that describes the relation between [[price]], [[marginal revenue]], and [[price elasticity of demand]].}}

{{term|[[ancient economic thought]]}}
{{defn|The {{gli|economics|economic}} ideas proposed by [[ancient history|ancient]] thinkers, in the {{gli|history of economic thought}}.}}

{{term|[[Anglo-Saxon model]]}}
{{defn|A school of thought based around low levels of regulation and taxation, minimal public services, strong private property rights, contract enforcement, overall ease of doing business, and low barriers to free trade.}}

{{term|[[annual effective discount rate]] (AER)}}
{{defn|The amount of interest paid or earned as a percentage of the balance at the end of the annual period.}}

{{term|[[anti-rival good]]}}
{{defn|The opposite of a [[rival good]]. The more people share an anti-rival good, the more utility each person receives.}}

{{term|[[Competition law|antitrust law]]}}
{{ghat|Also called a '''competition law''' or '''anti-monopoly law'''.}}
{{defn|Any law that promotes or seeks to maintain [[market competition]] by regulating [[anti-competitive]] conduct by companies.<ref name="papers.ssrn.com">{{cite SSRN |title=The Role of Competition Law: An Asian Perspective|first1=Rita Yi Man|last1=Li|first2=Yi Lut|last2=Li|date=1 June 2013|ssrn = 2281756}}</ref><ref name="Taylor 2006 1">{{Cite book| last = Taylor| first = Martyn D.| title = International competition law: a new dimension for the WTO?| publisher = Cambridge University Press| year = 2006| pages = 1| url = https://books.google.com/books?id=wTsfwxMvz_MC&q=competition+law| isbn = 978-0-521-86389-6 }}</ref> Competition law is implemented through public and private enforcement.<ref>{{cite web|last1=Cartel Damage Claims (CDC)|title=Cartel Damage Claims (CDC)|url=http://www.carteldamageclaims.com/|website=www.carteldamageclaims.com/|access-date=23 June 2014}}</ref> It is also known as "[[United States antitrust law|antitrust law]]" in the United States for historical reasons and as "anti-{{gli|monopoly}} law" in China<ref name="papers.ssrn.com"/> and Russia.}}

{{term|[[applied economics]]}}
{{defn|The application of [[economic theory]] and {{gli|econometrics}} in specific settings. As one of the two sets of fields of {{gli|economics}} (the other being the ''core''),<ref>{{cite web|url=https://www.aeaweb.org/resources/students/|title=American Economic Association|website=www.aeaweb.org}}</ref> it is typically characterized by the application of the ''core'', i.e. economic theory and econometrics, to address practical issues in a range of fields.}}

{{term|[[appropriate technology]]}}
{{defn|A movement (and its manifestations) encompassing technological choice and application that is small-scale, [[Decentralization|decentralized]], [[labor-intensive]], [[efficient energy use|energy-efficient]], [[environmentally sound]], and [[localism (politics)|locally autonomous]].<ref name=BrownU>{{cite book|title=Appropriate Technology: Tools, Choices, and Implications|year=1999|publisher=Academic Press|location=New York|isbn=978-0-12-335190-6|pages=3, 270|author=Hazeltine, B.|author2=Bull, C.}}</ref>}}

{{term|[[arbitrage]]}}
{{defn|The practice of taking advantage of a price difference between two or more {{gli|market|markets}} by striking a combination of matching deals that capitalize upon the imbalance, with the profit being the difference between the {{gli|market price|market prices}}.}}

{{term|[[Arrow–Debreu model]]}}
{{ghat|Also called the '''Arrow–Debreu–McKenzie model''' or '''ADM model'''.}}
{{defn|A model that suggests there must be a set of prices such that aggregate supplies will equal aggregate demands for every commodity in the economy, given certain assumptions. It can be used to prove the existence of general equilibrium (or Walrasian equilibrium) of an economy.<ref name=":0">{{cite journal | last1 = Arrow | first1 = K. J. | last2 = Debreu | first2 = G. | year = 1954 | title = Existence of an equilibrium for a competitive economy | journal = Econometrica | volume = 22 | issue =3 | pages = 265–290 | doi = 10.2307/1907353 | jstor = 1907353 }}</ref>}}

{{term|[[Arrow-Debreu security]]}}
{{ghat|Also called a '''state-price security''', '''pure security''', or '''primitive security'''.}}
{{defn|A contract that agrees to pay one unit of a numeraire (a currency or a commodity) if a particular state occurs at a particular time in the future and pays zero numeraire in all the other states.}}

{{term|[[Arrow information paradox]] (AIP)}}
{{ghat|Also called '''Arrow's disclosure paradox'''.}}
{{defn|A problem faced by companies when considering the transfer of intellectual property. A company may wish to sell some information, but it cannot fully describe the capabilities of the information without effectively transferring the information for free.}}

{{term|[[Arrow's impossibility theorem]]}}
{{ghat|Also called the '''general possibility theorem''' or '''Arrow's paradox'''.}}
{{defn|When voters have three or more distinct options, no [[ranked voting]] [[electoral system]] can convert the ranked preferences of individuals into a community-wide (complete and transitive) ranking while also meeting the specified set of criteria: [[unrestricted domain]], [[non-dictatorship]], [[Pareto efficiency]], and [[independence of irrelevant alternatives]].}}

{{term|[[Associate's Degree]]}}
{{defn|An academic program taken at the undergraduate level and after secondary school, which is considered a two-year degree and can be obtained from a community college, junior college, or some four-year universities.}}

{{term|[[Atkinson–Stiglitz theorem]]}}
{{defn|Where the utility function is separable between labor and all commodities, no indirect taxes need be employed.}}

{{term|[[Aumann's agreement theorem]]}}
{{defn|If the probabilistic beliefs of agents who share a common prior and update their probabilistic beliefs by Bayes' rule, regarding a fixed event, are common knowledge then these probabilities must coincide. Thus, agents cannot have common knowledge of a disagreement over the posterior probability of a given event.}}

{{term|[[austerity]]}}
{{defn|A set of [[Political economy|political-economic]] policies that aim to reduce [[Government budget balance|government budget deficits]] through spending cuts, tax increases, or a combination of both.<ref name="ft_lexicon">{{cite web|url=http://lexicon.ft.com/Term?term=austerity-measure|title=Austerity measure|work=[[Financial Times]] Lexicon|access-date=1 March 2013|archive-url=https://web.archive.org/web/20130322221836/http://lexicon.ft.com/Term?term=austerity-measure|archive-date=22 March 2013|url-status=dead}}</ref><ref name="Traynor">{{cite news|url=http://www.guardian.co.uk/business/2010/jun/11/europe-deficit-crisis-austerity-budgets|title=Austerity Europe: who faces the cuts|last=Traynor|first=Ian|author2=Katie Allen|date=11 June 2010|publisher=Guardian News|access-date=29 September 2010|location=London}}</ref><ref name="Wesbury">{{cite news|url=https://www.forbes.com/2010/07/26/government-spending-taxes-opinions-columnists-brian-wesbury-robert-stein.html |title=Government Austerity: The Good, Bad And Ugly |last=Wesbury |first=Brian S. |author2=Robert Stein |date=26 July 2010 |work=Forbes |access-date=29 September 2010 |archive-url=https://web.archive.org/web/20100929125657/http://www.forbes.com/2010/07/26/government-spending-taxes-opinions-columnists-brian-wesbury-robert-stein.html |archive-date=29 September 2010 |url-status=live }}</ref>}}

{{term|[[Austrian School]]}}
{{defn|A {{gli|heterodox economics|heterodox}}<ref name="Austrian Economists: Boettke">{{Cite web|url=http://austrianeconomists.typepad.com/weblog/2008/05/is-austrian-eco.html|title=Is Austrian Economics Heterodox Economics?|last=Boettke |first=Peter|publisher=The Austrian Economists|access-date=2009-02-13| archive-url= https://web.archive.org/web/20090328232903/http://austrianeconomists.typepad.com/weblog/2008/05/is-austrian-eco.html| archive-date= 28 March 2009 | url-status= live}}</ref><ref name="Boettke and Leeson">{{Cite book|last=Boettke|first=Peter J.|author2=Peter T. Leeson|title=A Companion to the History of Economic Thought|editor=[[Warren Samuels]] |editor2=Jeff E. Biddle |editor3=John B. Davis|pages=446–52|chapter=28A: The Austrian School of Economics 1950–2000|chapter-url=https://books.google.com/books?id=3H8gBQv5MysC&pg=PA445 |publisher=Blackwell Publishing |year=2003 |isbn=978-0-631-22573-7|author2-link=Peter T. Leeson}}</ref><ref>{{cite news | url=http://www.economist.com/node/21542174 | title=Heterodox economics: Marginal revolutionaries | newspaper=The Economist | date=December 31, 2011 | access-date=February 22, 2012 | url-status=live | archive-url=https://web.archive.org/web/20120222004727/http://www.economist.com/node/21542174 | archive-date=February 22, 2012 }}</ref> [[Schools of economic thought|school of economic thought]] that is based on [[methodological individualism]]—the concept that social phenomena result from the motivations and actions of individuals.<ref>Carl Menger, Principles of Economics, online at {{cite web |url=https://www.mises.org/etexts/menger/principles.asp |title=Principles of Economics |date=18 August 2014 |access-date=2014-09-13 |url-status=live |archive-url=https://web.archive.org/web/20140914004206/https://www.mises.org/etexts/menger/principles.asp |archive-date=2014-09-14 }}</ref><ref>{{cite book|url=https://plato.stanford.edu/archives/spr2015/entries/methodological-individualism/|title=The Stanford Encyclopedia of Philosophy|first=Joseph|last=Heath|editor-first=Edward N.|editor-last=Zalta|date=1 May 2018|publisher=Metaphysics Research Lab, Stanford University|access-date=1 May 2018|via=Stanford Encyclopedia of Philosophy}}</ref><ref name="Mises_Action">Ludwig von Mises.  [[Human Action]], p. 11, "Purposeful Action and Animal Reaction". Referenced 2011-11-23.</ref>}}

{{term|[[autarky]]}}
{{defn|The characteristic of being [[Self-sufficiency|self-sufficient]]; the term is usually applied to political states or their economic systems. Autarky is possible when an entity can survive or continue its activities without external assistance or [[international trade]]. If a self-sufficient economy also deliberately ''refuses'' all trade with the outside world, then it is called a '''closed economy'''.<ref>[http://www-personal.umich.edu/~alandear/glossary/c.html#ClosedEconomy|Deardorff's Glossary of International Economics] {{webarchive|url=https://web.archive.org/web/20071212072813/http://www-personal.umich.edu/~alandear/glossary/c.html |date=2007-12-12 }}.</ref>}}

{{term|[[automatic stabilizer]]}}
{{defn|A feature of the structure of modern government budgets, particularly {{gli|income tax|income taxes}} and {{gli|welfare|welfare spending}}, that acts to damp out fluctuations in {{gli|real gross domestic product|real GDP}}.<ref>{{cite book| last1 = O'Sullivan| first1 = Arthur| author-link = Arthur O'Sullivan (economist)| first2 = Steven M. | last2 = Sheffrin| title = Economics: Principles in Action| publisher = Savvas Learning Company | year = 2003| location = Paramus, New Jersey| page = 399| isbn = 978-0-13-063085-8}}</ref>}}

{{term|[[autonomous consumption]]}}
{{ghat|Also called '''exogenous consumption'''.}} 
{{defn|The consumption expenditure that occurs when income levels are zero. Such consumption is considered autonomous of income only when expenditure on these {{gli|consumable|consumables}} does not vary with changes in income; generally, it may be required to fund necessities and debt obligations. If income levels are actually zero, this consumption counts as {{gli|dissaving}}, because it is financed by {{gli|loan|borrowing}} or using up {{gli|savings}}.}}

{{term|[[average cost]]}}
{{ghat|Also called '''unit cost'''.}}
{{defn|A quantity equal to the {{gli|total cost}} divided by the number of goods produced (the output quantity, Q). It is also equal to the sum of {{gli|variable cost|variable costs}} (total variable costs divided by Q) plus {{gli|average fixed cost|average fixed costs}} (total {{gli|fixed cost|fixed costs}} divided by Q).}}

{{term|[[average fixed cost]]}}
{{defn|The {{gli|fixed cost|fixed costs}} (FC) of production divided by the quantity (Q) of {{gli|output}} produced. Fixed costs are those costs that must be incurred in fixed quantity regardless of the level of output produced.}}

{{term|[[average variable cost]]}}
{{defn|A firm's {{gli|variable cost|variable costs}} (labour, electricity, etc.) divided by the quantity of {{gli|output}} produced. Variable costs are those costs which vary with the output.}}

{{term|[[average tax rate]]}}
{{defn|The ratio of the total amount of {{gli|tax|taxes}} paid to the total {{gli|tax base}} (taxable income or spending), expressed as a percentage.<ref name="whatisthedif">{{cite web|url=http://www.fairtax.org/PDF/WhatIsTheDifferenceBetweenTaxRates.pdf|title=What is the difference between statutory, average, marginal, and effective tax rates?|publisher=Americans For Fair Taxation|access-date=2007-04-23|url-status=dead|archive-url=https://web.archive.org/web/20070614190648/http://www.fairtax.org/PDF/WhatIsTheDifferenceBetweenTaxRates.pdf|archive-date=2007-06-14}}</ref>}}
{{glossaryend}}

== B ==
{{glossary}}

{{term|[[Backus–Kehoe–Kydland puzzle]]}}
{{ghat|Also called the '''Backus–Kehoe–Kydland consumption correlation puzzle''' or '''BKK puzzle'''.}}
{{defn|The observation that consumption is much less correlated across countries than output. According to theory we should observe that consumption is much more correlated across countries than output in an [[Arrow–Debreu model|Arrow–Debreu economy]].}}

{{term|[[Backus–Smith puzzle]]}}
{{ghat|Also called the '''Backus-Smith consumption-real exchange rate puzzle''' or '''consumption – real-exchange-rate anomaly'''.}}
{{defn|The observation that the correlations between consumption and real exchange rates are zero or negative. This is contrary to economic theory which predicts that with full risk sharing, relative consumption should be perfectly correlated with the real exchange rate.}}

{{term|[[backward advantage]]}}
{{ghat|Also called the '''advantage of backwardness''' or the '''latecomer's advantage'''.}}
{{defn|The advantage that a still-developing country has because it can take advantage of the technology/industry gap with a developed country by implementing a new technology or venturing into an industry that is new to its economy but mature in the developed country.}}

{{term|[[backward disadvantage]]}}
{{ghat|Also called the '''latecomer's disadvantage'''.}}
{{defn|The fact that it is easier for late-development countries to imitate technologies, but more difficult to imitate the system, because the reform will offend vested interests.<ref>{{cite web|url=https://duoweicn.dwnews.com/zh/CN-2018%E5%B9%B4040%E6%9C%9F/10007285.html|title=The "Period of Contradictions" Has Arrived, What's the next step?|author=|date=29 Nov 2018|accessdate=|work=[[Duowei News]]|archive-date=9 July 2021|archive-url=https://web.archive.org/web/20210709181254/https://duoweicn.dwnews.com/zh/CN-2018%E5%B9%B4040%E6%9C%9F/10007285.html|url-status=dead}}</ref>}}

{{term|[[backward induction]]}}
{{defn|The process of reasoning backward in time, from the end of a problem or situation, to determine a sequence of optimal actions. It proceeds by first considering the last time a decision might be made and choosing what to do in any situation at that time. Using this information, one can then determine what to do at the second-to-last time of decision. This process continues backward until one has determined the best action for every possible situation (i.e. for every possible [[information set (game theory)|information set]]) at every point in time.}}

{{term|[[balance of payments]]}}
{{ghat|Also called '''balance of international payments''' and abbreviated '''B.O.P.''' or '''BoP'''.}}
{{defn|A record or summary of all economic transactions between the residents of a country and the rest of the world in a particular period of time (e.g. over a quarter of a year or, more commonly, over a year). These transactions are made by individuals, firms and government bodies. Thus the balance of payments includes all external visible and non-visible transactions of a country.}}

{{term|[[balance of trade]]}}
{{ghat|Also called '''commercial balance''' or '''net exports (NX)'''.}}
{{defn|The difference between the monetary value of a nation's {{gli|export|exports}} and {{gli|import|imports}} over a certain period.<ref>{{cite book |last1=O'Sullivan |first1=Arthur |author-link=Arthur O'Sullivan (economist) |first2=Steven M. |last2=Sheffrin |title=Economics |publisher=Savvas Learning Company |year=2022 |location=Paramus, New Jersey |page=462 |isbn=978-0-13-063085-8}}</ref> Sometimes a distinction is made between a balance of trade for goods versus one for services. "Balance of trade" can be a misleading term because trade measures a ''flow'' of exports and imports over a given period of time, rather than a ''balance'' of exports and imports at a given point in time. Also, balance of trade does not necessarily imply that exports and imports are "in balance" with each other or anything else.}}

{{term|[[balanced budget]]}}
{{defn|A {{gli|budget}} in which {{gli|revenue|revenues}} equal {{gli|expenditure|expenditures}}. Thus, neither a {{gli|budget deficit}} nor a {{gli|budget surplus}} exists (the accounts "balance"). The term may also refer more generally to a budget that has no budget deficit but could possibly have a budget surplus.<ref>{{cite book| last1 = O'Sullivan| first1 = Arthur| author-link = Arthur O'Sullivan (economist)| first2 = Steven M. | last2 = Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2022| location = Paramus, New Jersey| pages = 376, 403| isbn = 978-0-13-063085-8}}</ref> A cyclically balanced budget is a budget that is not necessarily balanced year-to-year, but is balanced over the {{gli|economic cycle}}, running a surplus in boom years and running a deficit in lean years, with these offsetting over time.}}

{{term|bank}}
{{defn|A financial institution that accepts {{gli|deposit account|deposits}} from the public and creates {{gli|demand deposit|credit}}.<ref>{{cite web |title=Bank of England |work=Rulebook Glossary |url=http://www.prarulebook.co.uk/rulebook/Glossary/Rulebook/0/B |date=1 January 2014 |access-date=13 July 2018 |archive-date=13 July 2018 |archive-url=https://web.archive.org/web/20180713043152/http://www.prarulebook.co.uk/rulebook/Glossary/Rulebook/0/B |url-status=dead }}</ref> Lending activities can be performed either directly or indirectly through [[capital market]]s. Due to their importance in the financial stability of a country, banks are [[Banking regulation|highly regulated]] in most countries. Most nations have institutionalized a system known as [[fractional reserve banking]], under which banks hold liquid assets equal to only a portion of their current liabilities. In addition to other regulations intended to ensure liquidity, banks are generally subject to [[minimum capital requirement]]s based on an international set of capital standards, known as the [[Basel Accords]].}}

{{term|[[bank rate]]}}
{{ghat|Also called the '''discount rate''' in American English.}}
{{defn|The rate of interest which a central bank charges on its loans and advances to a commercial bank.}}

{{term|bankruptcy}}
{{defn|The inability to pay {{gli|debt}} due to loss of income, increased spending, or an unforeseen financial crisis.}}

{{term|[[bargaining model of war]]}}
{{defn|A method of representing the potential gains and losses and ultimate outcome of war between two actors as a [[bargaining]] interaction.<ref name="Coyne Mathers 2011">{{cite book |last1=Coyne |first1=C.J. |last2=Mathers |first2=R.L. |title=The Handbook on the Political Economy of War |publisher=Edward Elgar Publishing Limited |series=Elgar Original Reference Series |year=2011 |isbn=978-1-84980-832-3 |url=https://books.google.com/books?id=-rSF4xEMhDwC&pg=PA19 |access-date=11 July 2018 |page=19}}</ref>}}

{{term|[[barriers to entry]]}}
{{defn|In theories of {{gli|competition}} in economics, a cost that must be incurred by a new entrant into a {{gli|market}} that incumbents do not have or have not had to incur.<ref name="entryBarriersInEconomicAndAntitrustAnalysis">{{cite web|url=http://authors.library.caltech.edu/11284/1/MCAaer04.pdf|title=When Are Sunk Costs Barriers to Entry? |website=caltech.edu|access-date=3 May 2018|url-status=live|archive-url=http://archive.wikiwix.com/cache/20160327112428/http://authors.library.caltech.edu/11284/1/MCAaer04.pdf|archive-date=27 March 2016}}</ref><ref>{{cite web|url=http://www.micronomics.com/articles/UCLA_Law_Institute_Barriers_to_Entry_Final.pdf|title=Antitrust Aspects of Barriers to Entry|website=micronomics.com|access-date=3 May 2018|url-status=live|archive-url=https://web.archive.org/web/20170517011312/http://www.micronomics.com/articles/UCLA_Law_Institute_Barriers_to_Entry_Final.pdf|archive-date=17 May 2017}}</ref> Because barriers to entry protect incumbent firms and restrict competition in a market, they can contribute to distortionary prices and are therefore most important when discussing {{gli|antitrust}} policy. Barriers to entry often cause or aid the existence of {{gli|monopoly|monopolies}} or give companies {{gli|market power}}.}}

{{term|[[barter]]}}
{{ghat|also called '''direct exchange'''.}}
{{defn|In {{gli|trade}}, a system of {{gli|exchange}} in which participants in a {{gli|transaction}} directly exchange {{gli|good|goods}} or {{gli|service|services}} for other goods or services without using a {{gli|medium of exchange}}, such as {{gli|money}}.<ref>{{cite book |last = O'Sullivan |first = Arthur |author2= Steven M. Sheffrin |title = Economics |publisher = Savvas Learning Company |year= 2022 |page= 243 |isbn= 978-0-13-063085-8}}</ref> Economists distinguish barter from {{gli|gift economy|gift economies}} in many ways; barter, for example, features immediate [[Reciprocity (cultural anthropology)|reciprocal exchange]] that is not delayed in time. Barter usually takes place on a [[Bilateral trade|bilateral]] basis, but may be [[Multilateral exchange|multilateral]] (i.e. mediated through a {{gli|trade exchange}}). In most [[developed countries]], barter usually only exists parallel to monetary systems to a very limited extent. Market actors use barter as a replacement for money as the method of exchange in times of [[monetary crisis]], such as when {{gli|currency}} becomes unstable (e.g. by {{gli|hyperinflation}} or a {{gli|deflationary spiral}}) or simply unavailable for conducting {{gli|commerce}}.}}

{{term|[[base erosion and profit shifting]] (BEPS)}}
{{defn|Corporate tax planning strategies used by multinationals to "shift" profits from higher-tax jurisdictions to lower-tax jurisdictions or no-tax locations.}}

{{term|Baxter-Stockman neutrality of exchange rate regime puzzle}}
{{ghat|Also called the '''exchange rate disconnect puzzle'''.}}
{{defn|The unexpectedly weak relationship between the exchange rate and any other macroeconomic variable.<ref>{{Cite web |last1=Obstfeld |first1=Maurice |last2=Rogoff |first2=Kenneth |date=2000-07-03 |title=The Six Major Puzzles in International Macroeconomics: Is There a Common Cause? |url=https://escholarship.org/uc/item/0sx02651 |language=en}}</ref>}}

{{term|[[Beckstrom's law]]}}
{{defn|"The value of a network equals the net value added to each user’s transactions conducted through that network, summed over all users."}}

{{term|[[behavioral economics]]}}
{{defn|The branch of {{gli|economics}} that studies the effects of psychological, cognitive, emotional, cultural and social factors on the economic [[decision making|decisions]] of individuals and institutions and how those decisions vary from those implied by classical theory.<ref name="ssrn.com">{{cite journal|ssrn=2040946|title=A Behavioral Framework for Securities Risk|publisher =SSRN|last = Lin|first = Tom C. W. |date = 16 April 2012|journal = Seattle University Law Review}}</ref>}}

{{term|[[Bellman equation]]}}
{{defn|The dynamic programming equation associated with [[discrete-time]] optimization problems.<ref>{{cite book |last1=Kirk |first1=Donald E. |title=Optimal Control Theory: An Introduction |date=1 January 2004 |publisher=Courier Corporation |isbn=978-0-486-43484-1 |page=70 |url=https://books.google.com/books?id=fCh2SAtWIdwC&pg=PA70 |language=en}}</ref>'' It writes the "value" of a decision problem at a certain point in time in terms of the payoff from some initial choices and the "value" of the remaining decision problem that results from those initial choices.}}

{{term|[[bequest motive]]}}
{{defn|Seeks to provide an economic justification for the phenomenon of [[intergenerational]] transfers of {{gli|wealth}}; in other words, to explain why people leave money behind when they die.}}

{{term|[[Bertrand competition]]}}
{{defn|A model of competition that describes interactions among producers that set prices and their consumers that choose quantities at the prices set.}}

{{term|[[Bertrand–Edgeworth model]]}}
{{defn|A {{gli|microeconomics|microeconomic}} model of price-setting oligopoly which studies what happens when there is a homogeneous product (i.e. consumers want to buy from the cheapest seller) where there is a limit to the output of firms which they are willing and able to sell at a particular price. This differs from the Bertrand competition model where it is assumed that firms are willing and able to meet all demand. The limit to output can be considered a physical capacity constraint which is the same at all prices (as in [[Francis Ysidro Edgeworth|Edgeworth]]’s work) or to vary with price under other assumptions.}}

{{term|[[Bertrand paradox (economics)|Bertrand paradox]]}}
{{defn|A situation in which two players (firms) reach a state of Nash equilibrium where both firms charge a price equal to marginal cost.}}

{{term|[[biflation]]}}
{{ghat|Also called '''mixflation'''.}}
{{defn|A state of the economy in which the processes of inflation and [[deflation]] occur simultaneously in different parts of the economy.<ref name="NW">{{cite web |last1=Summers |first1=Nick |title=What Is 'Biflation'? |url=https://www.newsweek.com/what-biflation-71855 |website=[[Newsweek]] |access-date=10 August 2021 |language=en |date=16 August 2010}}</ref><ref>{{cite web |title=Biflation |url=https://www.collinsdictionary.com/submission/9109/Biflation |publisher=[[Collins Dictionary]] |access-date=10 August 2021}}</ref> }}

{{term|[[big push model]]}}
{{defn|A concept in {{gli|development economics}} or {{gli|welfare economics}} that emphasizes that a firm's decision whether to industrialize or not depends on its expectation of what other firms will do. It assumes {{gli|economies of scale}} and [[oligopoly|oligopolistic]] market structure and explains when industrialization would happen.}}

{{term|[[Birmingham school (economics)|Birmingham school]]}}
{{defn|A school of thought based around opposing the gold standard, advocating for expansionary monetary policy, and belief in underconsumption.}}

{{term|[[Bishop–Cannings theorem]]}}
{{defn|A [[theorem]] in [[evolutionary game theory]] that states that (i) all members of a mixed [[evolutionarily stable strategy]]  have the same payoff, and (ii) that none of these can also be a pure ESS.<ref name="BandC78">{{Cite journal |last1=Bishop |first1=D.T. |last2=Cannings |first2=C. |date=1978 |title=A generalized war of attrition |url=https://linkinghub.elsevier.com/retrieve/pii/0022519378903041 |journal=Journal of Theoretical Biology |language=en |volume=70 |issue=1 |pages=85–124 |doi=10.1016/0022-5193(78)90304-1|pmid=564432 |bibcode=1978JThBi..70...85B }}</ref>}}

{{term|[[Black–Scholes model]]}}
{{ghat|Also called the '''Black–Scholes–Merton model'''.}} 
{{defn|A mathematical model for the dynamics of a [[financial market]] containing [[Derivative (finance)|derivative]] investment instruments. From the [[partial differential equation]] in the model, known as the [[Black–Scholes equation]], one can deduce the '''Black–Scholes formula''', which gives a theoretical estimate of the price of [[option style|European-style]] [[option (finance)|options]] and shows that the option has a unique price regardless of the risk of the security and its expected return (instead replacing the security's expected return with the [[risk-neutral]] rate). The formula led to a boom in options trading and provided mathematical legitimacy to the activities of the [[Chicago Board Options Exchange]] and other options markets around the world.<ref name="mackenzie">{{cite book|title= An Engine, Not a Camera: How Financial Models Shape Markets|last= MacKenzie|first= Donald|author-link= Donald Angus MacKenzie|year= 2006|publisher= MIT Press|location= Cambridge, MA|isbn= 978-0-262-13460-6|url= https://archive.org/details/enginenotcamerah00mack_0}}</ref> It is widely used, although often with adjustments and corrections, by options market participants.<ref name="bodie-kane-marcus">{{cite book |title= Investments|last= Bodie|first= Zvi|author-link=Zvi Bodie |author2=Alex Kane|author3=Alan J. Marcus|year= 2008|publisher= McGraw-Hill/Irwin|location= New York|edition=7th|isbn=978-0-07-326967-2 }}</ref>{{rp|751}}}}

{{term|[[board of governors]]}}
{{defn|The main governing body that directs the operations of the United States {{gli|Federal Reserve System}}. Its seven members supervise the 12 Federal Reserve Districts.}}

{{term|[[Bond (finance)|bond]]}}
{{defn|In {{gli|finance}}, an instrument of indebtedness of the bond issuer to the holders. The most common types of bonds include [[municipal bond]]s and [[corporate bond]]s. The bond is a {{gli|debt}} {{gli|security}}, under which the issuer owes the holders a debt and (depending on the terms of the bond) is obliged to pay them {{gli|interest}} (the {{gli|coupon}}) or to repay the principal at a later date, termed the {{gli|maturity}} date.<ref>{{Cite book| last = O'Sullivan| first = Arthur|author2=Sheffrin, Steven M.| title = Economics: Principles in action| publisher = Savvas Learning Company| year = 2022| location = Upper Saddle River, New Jersey| pages = 197, 507| url = https://www.savvas.com/index.cfm?locator=PS3jRm| isbn = 978-0-13-063085-8}}</ref> Interest is usually payable at fixed intervals (semiannual, annual, or sometimes monthly). Very often the bond is negotiable, that is, the ownership of the instrument can be transferred in the secondary market. This means that once the transfer agents at the bank medallion stamp the bond, it is highly liquid on the secondary market.<ref>[http://www.moneycontrol.com/pehlakadam/bonds.php Bonds], accessed: 2012-06-08</ref>}}

{{term|[[Bondareva–Shapley theorem]]}}
{{defn|Describes a necessary and sufficient condition for the non-emptiness of the core of a cooperative game in characteristic function form.}}

{{term|[[boots theory]]}}
{{ghat|Also called the '''Sam Vimes theory of socioeconomic unfairness'''.}} 
{{defn|Purchasing cheap, low-quality goods may become more expensive in the long run because they must be replaced more frequently. For example, purchasing expensive, high-quality boots may be cheaper over a long time because cheaper boots would quickly wear out and require replacement.}}

{{term|[[borrower]]}}
{{defn|See ''{{gli|debtor}}''.}}

{{term|[[bounded rationality]]}}
{{defn|The idea that [[rationality]] is limited when individuals [[decision-making|make decisions]], and under these limitations, rational individuals will select a decision that is [[satisficing|satisfactory]] rather than optimal.<ref>{{cite journal |last1=Sent |first1=Esther-Mirjam |title=Rationality and bounded rationality: you can't have one without the other |journal=The European Journal of the History of Economic Thought |date=October 31, 2017 |volume=25 |issue=6 |pages=1370–1386 |doi=10.1080/09672567.2018.1523206 |doi-access=free|hdl=2066/199920 |hdl-access=free }}</ref>}}

{{term|[[Braess's paradox]]}}
{{defn|The observation that adding one or more roads to a road network can slow down overall traffic flow through it.}}

{{term|[[Brander–Spencer model]]}}
{{defn|An economic model in international trade that illustrates a situation where a government can subsidize domestic firms to help them in their competition against foreign producers and in doing so enhances national welfare.}}

{{term|[[break-even (economics)|break-even]]}}
{{ghat|Also called the '''break-even point (BEP)'''.}}
{{defn|The point at which total {{gli|cost}} and total {{gli|revenue}} are equal, i.e. "even". There is no net loss or gain, and one has "broken even", though {{gli|opportunity cost|opportunity costs}} have been paid and {{gli|capital}} has received the risk-adjusted, expected return. In short, all costs that must be paid are paid, and there is neither profit nor loss.<ref name='R000000'>{{cite book | last = Levine | first = David | author-link = David K. Levine |author2= Michele Boldrin | title = Against Intellectual Monopoly | publisher = Cambridge University Press | date = 2008-09-07 | pages = 312 | url = http://www.dklevine.com/general/intellectual/againstfinal.htm | isbn = 978-0-521-87928-6 }}</ref><ref>Tapang, Bienvenido, and Lorelei Mendoza. ''Introductory Economics.'' University of the Philippines, Baguio.</ref>}}

{{term|[[Bretton Woods system]]}}
{{defn|A {{gli|monetary system}} which established the rules for commercial and financial relations among the United States, Canada, Western Europe, Australia, and Japan after the 1944 Bretton Woods Agreement. The Bretton Woods system was the first example of a fully {{gli|representative money|negotiated}} monetary order intended to govern monetary relations among independent states. The chief features were an obligation for each country to adopt a monetary policy that maintained its external {{gli|exchange rate|exchange rates}} within 1 percent by tying its currency to gold and the ability of the {{gli|International Monetary Fund|IMF}} to bridge temporary {{gli|balance of payments|imbalances of payments}}; there was also a need to address the lack of cooperation among other countries and to prevent [[competitive devaluation]] of the currencies.}}

{{term|[[budget]]}}
{{defn|The itemization of an individual's or firm's total income and total expenses for a set period of time, usually a month or a year.}}

{{term|[[Deficit spending|budget deficit]]}}
{{ghat|Also simply called '''spending'''.}}
{{defn|The amount by which spending exceeds {{gli|revenue}} over a particular period of time; it is the opposite of {{gli|budget surplus}}. The term may be applied to the budget of a government, private company, or individual.}}

{{term|[[budget set]]}}
{{ghat|Also called an '''opportunity set'''.}}
{{defn|The set of all possible consumption bundles that an individual can afford, given the {{gli|price|prices}} of goods and the individual's {{gli|income}} level. The budget set is bounded above by the [[Budget constraint|budget line]]. Graphically speaking, all the consumption bundles that lie inside and on the budget constraint form the budget set. By most definitions, budget sets must be [[Compact set|compact]] and [[Convex set|convex]].}}


{{term|[[Engel curve|budget share Engel curve]]}}
{{defn|Describes how the proportion of household income spent on a good or service varies with income.}}

{{term|[[budget surplus]]}}
{{defn|A budget's revenues in excess of its expenditures.}}

{{term|[[buffer stock scheme]]}}
{{ghat|Also called '''intervention storage''' or the '''ever-normal granary'''.}}
{{defn|An attempt to use [[commodity]] storage for the purposes of [[price stability|stabilising prices]] in an entire economy or an individual (commodity) market. Specifically, [[commodities]] are bought when a [[Economic surplus|surplus]] exists in the economy, stored, and are then sold from these stores when [[economic shortage]]s in the economy occur.<ref name="Morrow1980">{{cite book|last=Morrow|first=Daniel T.|title=The economics of the international stockholding of wheat|url=https://books.google.com/books?id=czEts2pPxq4C|year=1980|publisher=International Food Policy Research Institute|isbn=978-0-89629-019-8}}</ref>}}

{{term|[[bullionism]]}}
{{defn|An economic theory that defines wealth by the amount of [[precious metal]]s owned.<ref>{{cite book |last1=Kindleberger |first1=Charles P. |title=A Financial History of Western Europe |date=3 June 2015 |publisher=Routledge |isbn=978-1-136-80578-3 |page=33 |url=https://books.google.com/books?id=tgzICQAAQBAJ&pg=PA33 |language=en}}</ref>}}

{{term|[[business cycle]]}}
{{ghat|Also called the '''economic cycle''' or '''trade cycle'''.}}
{{defn|The downward and upward movement of {{gli|gross domestic product}} (GDP) around its long-term growth trend.<ref>{{cite journal | last1 = Madhani | first1 = P. M. | year = 2010 | title = .Rebalancing Fixed and Variable Pay in a Sales Organization: A Business Cycle Perspective | journal = [[Compensation & Benefits Review]] | volume = 42 | issue = 3| pages = 179–189 | doi=10.1177/0886368709359668| s2cid = 154281029 }}</ref> The length of a business cycle is the period of time containing a single boom and contraction in sequence. These fluctuations typically involve shifts over time between periods of relatively rapid economic growth ({{gli|economic expansion|expansions}} or {{gli|boom|booms}}) and periods of relative stagnation or decline ({{gli|contraction|contractions}} or {{gli|recession|recessions}}).}}

{{term|[[business economics]]}}
{{defn|A branch of {{gli|applied economics}} which uses [[economic theory]] and quantitative methods to analyze [[Business|business enterprises]] and the factors contributing to the diversity of organizational structures and the relationships of firms with labour, {{gli|capital}} and product markets.<ref name="Moschandreas">Moschandreas, Maria (2000). ''Business Economics'', 2nd Edition, Thompson Learning,  [https://books.google.com/books?id=ncVfjhTULyAC&pg=PA410 Description] and chapter-preview [https://books.google.com/books?id=ncVfjhTULyAC&pg=PR5 links].</ref>}}

{{term|[[business sector]]}}
{{ghat|Also called the '''corporate sector''' or sometimes simply '''business'''.}}
{{defn|The part of the {{gli|economy}} made up by [[company|companies]].<ref>Longman Business English Dictionary</ref> It is generally considered a subset of the [[Sovereign state|domestic]] economy,<ref>But compare {{cite book| last1=Keese| first1=Mark| last2=Salou| first2=Gérard| last3= Richardson| first3=Pete| title=The measurement of output and factors of production for the business sector in OECD countries: the OECD business sector database| url=https://books.google.com/books?id=Zzm5AAAAIAAJ| series=OECD Department of Economics and Statistics working papers| volume=99| publisher=Organisation for Economic Co-operation and Development| date=1991| page=i| access-date=2015-06-07| quote=[...] recent work of the OECD Economics and Statistics Department to construct an international Business Sector Data Base (BSDB) for use in a wide variety of analyses of production and supply issues [...].}}</ref> excluding the economic activities of general government, of private households, and of non-profit organizations serving individuals.<ref>{{cite web |url=http://www.bls.gov/bls/glossary.htm |title=BLS Information |date=February 28, 2008 |work=Glossary |publisher=U.S. Bureau of Labor Statistics Division of Information Services |access-date=2009-05-05}}</ref>}}
{{glossaryend}}

==C==
{{glossary}}
{{term|[[Cambridge capital controversy]]}}
{{ghat|Also called '''the capital controversy''' or '''the two Cambridges debate'''.}}
{{defn|A dispute between proponents of two differing theoretical and mathematical positions in economics concerning the nature and role of [[capital (economics)|capital]] goods and a critique of the [[Neoclassical economics|neoclassical]] vision of aggregate production and distribution.<ref name=tche>Tcherneva (2011)</ref>}}

{{term|[[Cambridge equation]]}}
{{defn|Relates money demand, price level, and real national income in the Cambridge quantity theory of money.}}

{{term|[[cameralism]]}}
{{defn|A German science of [[public administration]] in the 18th and early 19th centuries that aimed at strong management of a centralized economy for the benefit mainly of the [[State (polity)|state]].<ref name="oxford-dict">{{cite web |title=Definition of cameralism in English |url=https://en.oxforddictionaries.com/definition/cameralism |archive-url=https://web.archive.org/web/20190101002814/https://en.oxforddictionaries.com/definition/cameralism |url-status=dead |archive-date=January 1, 2019 |website=Oxford Dictionaries |publisher=Oxford University Press |quote=An economic theory prevalent in 18th-cent. Germany, which advocated a strong public administration managing a centralized economy primarily for the benefit of the state.}}</ref> }}

{{term|[[Emissions trading|cap and trade (CAT)]]}}
{{defn|A market-based approach to limiting negative externalities (for example, pollution) by providing economic [[incentive]]s for reducing the production of said negative externalities.<ref name="stavins01">{{Cite journal |first=Robert N. |last=Stavins |date=November 2001 |access-date=2010-05-20 |title=Experience with Market-Based Environmental Policy Instruments |url=http://www.rff.org/documents/RFF-DP-01-58.pdf |journal=Discussion Paper 01-58 |publisher=Resources for the Future |location=Washington, D.C. |quote=Market-based instruments are regulations that encourage behavior through market signals rather than through explicit directives regarding pollution control levels or methods |archive-url=https://web.archive.org/web/20110501113141/http://www.rff.org/documents/RFF-DP-01-58.pdf |archive-date=2011-05-01 |url-status=dead }}</ref> A central authority or [[government agency|governmental]] body allocates or sells a limited number (a "cap") of permits that allow the creation of a specific negative externality over a set time period. Permit owners are then allowed to sell these permits to others.}}

{{term|[[capacity utilization]]}}
{{defn|The extent to which an enterprise or a nation uses its installed [[productive capacity]]. It is the relationship between {{gli|output}} that ''is'' produced with the installed equipment and the potential output which ''could'' be produced with it if capacity was fully used.}}

{{term|[[Capital (economics)|capital]]}}
{{defn|Any asset that can enhance one's power to perform economically useful work. '''Capital goods''', '''real capital''', or [[capital asset]]s are already-produced, [[durable good]]s or any non-financial asset that is used in {{gli|production}} of {{gli|good|goods}} or {{gli|service|services}}.<ref name="Boulding">{{cite web|last1=Boulding|first1=Kenneth E.|title=Capital and interest|url=http://www.britannica.com/topic/capital-economics|website=Encyclopedia Britannica|access-date=July 22, 2017|language=en}}</ref> Capital is distinct from land (or [[non-renewable resources]]) in that capital can be increased by human labor. At any given moment in time, total [[physical capital]] may be referred to as the '''capital stock''' (which is not to be confused with the {{gli|stock|capital stock}} of a business entity).}}

{{term|[[capital account]]}}
{{ghat|Also called the '''capital and financial account'''}}
{{defn|Reflects net change in ownership of national assets. A surplus in the capital account means money is flowing into the country, and the inbound flows effectively represent borrowings or sales of assets. A deficit in the capital account means money is flowing out of the country, and it suggests the nation is increasing its ownership of foreign assets.}}

{{term|[[capital accumulation]]}}
{{defn|Any net addition to existing wealth and/or a redistribution of wealth. Capital accumulation is the dynamic that motivates the pursuit of [[Profit (economics)|profit]], involving the investment of money or any financial asset with the goal of increasing the initial monetary value of said asset as a financial return.}}

{{term|[[capital cost]]}}
{{defn|A fixed, one-time {{gli|expenditure|expense}} incurred on the purchase of {{gli|real property|land}}, buildings, construction, and equipment used in the production of goods or in the rendering of services. In other words, it is the total cost needed to bring a project to a commercially operable status. Whether a particular cost is capital or not depends on many factors, such as accounting, [[tax law]]s, and [[Materiality (auditing)|materiality]].}}

{{term|[[capital flight]]}}
{{defn|Occurs when money or assets rapidly flow out of a country due to an event of economic consequence. Such events may include an increase in {{gli|tax|taxes}} on {{gli|capital}} or capital holders or the government of the country [[default (finance)|defaulting]] on its debt that disturbs investors and causes them to lower their valuation of the assets in that country or otherwise to lose confidence in its economic strength.}}

{{term|[[capital formation]]}}
{{defn|Any method for increasing the amount of [[Capital (economics)|capital]] owned or under one's control, or any method in using or mobilizing capital resources for investment purposes. Capital formation also sometimes refers to a specific statistical concept, also known as [[net investment]], which measures the net additions to the (physical) capital [[stock and flow|stock]] of a country (or an economic sector) in an accounting interval. Capital formation is also sometimes a modern general term for [[capital accumulation]], referring to the total "stock of capital" that has been formed, or to the growth of this total capital stock.<ref>Yanovsky, M.: ''Anatomy of Social Accounting Systems'', London; Chapman & Hall, 1965.</ref>}}

{{term|[[capital gain]]}}
{{defn|The [[Profit (economics)|profit]] earned on the sale of an [[asset]] which has increased in value over the holding period. An asset may include [[tangible property]], a car, a business, or [[intangible property]] such as [[share capital|shares]].}}

{{term|[[capital good]]}}
{{defn|A {{gli|durable good}} that is used in the production of goods or services. Capital goods are one of the three types of producer goods, the other two being land and labour, which are also known collectively as primary {{gli|factors of production}}. This classification originated with {{gli|classical economics}} and has remained the dominant method for classification.}}

{{term|[[capital intensity]]}}
{{defn|The amount of fixed or real [[Capital (economics)|capital]] present in relation to other [[factors of production]], especially labor. At the level of either a production process or the aggregate economy, it may be estimated by the capital to labor ratio, such as from the points along a capital/labor [[isoquant]].}}

{{term|[[capitalism]]}}
{{defn|An [[economic system]] based on the [[private ownership]] of the [[means of production]] and their operation for [[Profit (economics)|profit]].<ref>{{cite book |last1=Zimbalist |last2=Sherman |last3=Brown |first1=Andrew |first2=Howard J. |first3=Stuart |title=Comparing Economic Systems: A Political-Economic Approach |publisher=[[Harcourt College Publishing]] |date=October 1988 |isbn=978-0-15-512403-5 |pages=[https://archive.org/details/comparingeconomi0000zimb_q8i6/page/6 6–7] |quote=Pure capitalism is defined as a system wherein all of the means of production (physical capital) are privately owned and run by the capitalist class for a profit, while most other people are workers who work for a salary or wage (and who do not own the capital or the product). |url=https://archive.org/details/comparingeconomi0000zimb_q8i6/page/6}}</ref><ref>{{cite book |last1=Rosser |first1=Mariana V. |last2=Rosser |first2=J Barkley |title=Comparative Economics in a Transforming World Economy |publisher=[[MIT Press]] |date=23 July 2003 |isbn=978-0-262-18234-8 |page=7 |quote=In capitalist economies, land and produced means of production (the capital stock) are owned by private individuals or groups of private individuals organized as firms.}}</ref><ref>{{cite book |first=Chris |last=Jenks |title=Core Sociological Dichotomies |quote=Capitalism, as a mode of production, is an economic system of manufacture and exchange which is geared toward the production and sale of commodities within a market for profit, where the manufacture of commodities consists of the use of the formally free labor of workers in exchange for a wage to create commodities in which the manufacturer extracts surplus value from the labor of the workers in terms of the difference between the wages paid to the worker and the value of the commodity produced by him/her to generate that profit. |location=London; Thousand Oaks, CA; New Delhi. |publisher=[[SAGE Publishing]] |page=383}}</ref><ref>{{cite book |title=The Challenge of Global Capitalism : The World Economy in the 21st Century |last=Gilpin |first=Robert |isbn=978-0-691-18647-4 |oclc=1076397003 |date=5 June 2018|publisher=Princeton University Press }}</ref> Central characteristics of capitalism include [[capital accumulation]], [[competitive market]]s, [[price system]]s, [[private property]], [[Property rights (economics)|property rights]] recognition, [[voluntary exchange]], and [[wage labor]].<ref>Heilbroner, Robert L. [http://www.dictionaryofeconomics.com/article?id=pde2008_C000053 "Capitalism"] {{Webarchive|url=https://web.archive.org/web/20171028232506/http://www.dictionaryofeconomics.com/article?id=pde2008_C000053 |date=28 October 2017 }}. Steven N. Durlauf and Lawrence E. Blume, eds. ''The New Palgrave Dictionary of Economics''. 2nd {{abbr|ed.|edition}} (Palgrave Macmillan, 2008) {{doi|10.1057/9780230226203.0198}}.</ref><ref>{{cite book |first1=Louis |last1=Hyman |first2=Edward E. |last2=Baptist |date=2014 |url=http://books.simonandschuster.com/American-Capitalism/Louis-Hyman/9781476784311 |title=American Capitalism: A Reader |archive-url=https://web.archive.org/web/20150522065957/http://books.simonandschuster.com/American-Capitalism/Louis-Hyman/9781476784311 |archive-date=22 May 2015 |publisher=[[Simon & Schuster]] |isbn=978-1-4767-8431-1}}</ref>}}

{{term|[[cartel]]}}
{{defn|Any group of firms that colludes and acts as a single coordinated whole to restrict output and drive up prices.}}

{{term|[[cash]]}}
{{defn|Money in the physical form of currency, such as [[banknote]]s and [[coin]]s.}}

{{term|[[central bank]]}}
{{ghat|Also called a '''reserve bank''' or '''monetary authority'''.}} 
{{defn|An institution that manages the {{gli|currency}}, {{gli|money supply}}, and {{gli|interest rate|interest rates}} of an entire state or nation. Central banks also usually oversee the [[commercial bank|commercial banking system]] of their respective countries. In contrast to a commercial bank, a central bank possesses a {{gli|monopoly}} on increasing the {{gli|monetary base}} in the state, and usually also prints the national currency,<ref>{{Cite web  |url= http://www.bankofcanada.ca/2013/11/5-and-10-bank-note-issue-2/|title=$5 and $10 Bank Note Issue|author=Bank of Canada|access-date=7 November 2013}}</ref> which usually serves as the state's legal tender. Central banks also act as a "[[lender of last resort]]" to the banking sector during times of financial crisis. Most central banks usually also have supervisory and regulatory powers to ensure the solvency of member institutions, prevent [[bank run]]s, and prevent reckless or fraudulent behavior by member banks.}}

{{term|[[Certificate of Deposit]] (CD or COD)}}
{{defn|A savings instrument that usually earns more {{gli|interest}} than a savings account but is bound by limits set within a contract.}}

{{term|[[ceteris paribus]]}}
{{defn|A phrase or clause often loosely translated as "holding all else constant." It does not imply that no other things will in fact change; rather, it isolates the effect of one particular change.<ref>Liberto, D. (2023, January). What Does Ceteris Paribus Mean in Economics? Retrieved from Investopedia: https://www.investopedia.com/terms/c/ceterisparibus.asp#:~:text=All%20things%20being%20equal%2C%20if,if%20the%20price%20is%20higher.</ref>}}

{{term|[[charitable giving]]}}
{{defn|A gift of cash or property made to a nonprofit organization to help it accomplish its goals, for which the donor receives nothing of value in return. In the U.S. however, some charitable giving is tax deductible.}}

{{term|[[chartalism]]}}
{{defn|A [[Heterodox economics|heterodox]] theory of money that argues that money originated historically with states' attempts to direct economic activity rather than as a spontaneous solution to the problems with [[barter]] or as a means with which to tokenize debt,<ref>{{cite book|last1=Graeber|first1=David|title=Debt: The First 5000 Years|date=12 July 2011|publisher=Melville House |isbn=978-1-933633-86-2|url-access=registration|url=https://archive.org/details/debtfirst5000yea00grae}}</ref> and that [[fiat currency]] has value in exchange because of sovereign power to levy [[taxes]] on economic activity payable in the currency they issue.}}

{{term|[[check (money)]]}}
{{defn|A check is a written, dated, and signed draft that directs a bank to pay a specific sum of money to the bearer. The person or entity writing the check is known as the payor or drawer, while the person to whom the check is written is the payee.}}

{{term|[[Chicago school of economics|Chicago school]]}}
{{defn|A [[Neoclassical economics|neoclassical]] school of thought once based around rational expectations, monetarism, and free market supremacy.}}

{{term|[[Choice]] (CD or COD)}}
{{defn|Making a decision when facing multiple possible options.}}

{{term|[[choice modelling]]}}
{{defn|A method of modelling the decision process of an individual or segment via revealed or stated preferences.}}

{{term|[[circular flow of income]]}}
{{ghat|Also called '''circular flow model'''.}}
{{defn|A model of the economy in which the major exchanges are represented as flows of {{gli|money}}, {{gli|good|goods}} and {{gli|service|services}}, etc. between {{gli|agent|economic agents}}. The flows of money and goods exchanged in a closed circuit correspond in value, but run in the opposite direction. The circular flow analysis is the basis of [[national accounts]] and hence of {{gli|macroeconomics}}.}}

{{term|[[Circulation (currency)|circulation]]}}
{{defn|The continuous movement of goods, services, and money within an economy.}}

{{term|[[citizen's dividend]]}}
{{defn|A proposed set of regular payments to all citizens from revenue raised by leasing or taxing the monopoly of valuable land and other natural resources. It is based on the Georgist principle that the natural world is the common property of all people.}}

{{term|[[classical economics]]}}
{{ghat|Also called '''classical political economy'''.}}
{{defn|A [[school of thought]] in economics that flourished, primarily in [[Kingdom of Great Britain|Britain]], in the late 18th and early-to-mid 19th century. Its main thinkers are held to be [[Adam Smith]], [[Jean-Baptiste Say]], [[David Ricardo]], [[Thomas Robert Malthus]], and [[John Stuart Mill]]. These economists produced a theory of [[Market economy|market economies]] as largely self-regulating systems, governed by natural laws of production and exchange (famously captured by Adam Smith's metaphor of the [[invisible hand]]).}}

{{term|[[classical general equilibrium model]]}}
{{defn|A model that aims to describe the economy by aggregating the behavior of individuals and firms.<ref>{{Cite journal |last=Burgstaller |first=André |date=1989 |title=A Classical Model of Growth, Expectations and General Equilibrium |url=https://www.jstor.org/stable/2554284 |journal=Economica |volume=56 |issue=223 |pages=373–393 |doi=10.2307/2554284 |jstor=2554284 |issn=0013-0427|url-access=subscription }}</ref> Note that the classical [[general equilibrium]] model is unrelated to [[classical economics]], and was instead developed within [[neoclassical economics]] beginning in the late 19th century.<ref>{{Cite book |last=McKenzie |first=Lionel W. |url=https://www.worldcat.org/oclc/49226070 |title=Classical general equilibrium theory |date=2002 |publisher=MIT Press |isbn=0-262-13413-6 |location=Cambridge, Mass. |oclc=49226070}}</ref>}}

{{term|[[club good]]}}
{{ghat|Also called '''artificially scarce goods''', '''toll goods''', '''collective goods''' or '''quasi-public goods'''.}}
{{defn|A good that is [[excludability|excludable]] but [[non-rivalrous]], at least until reaching a point where [[:wikt:congestion|congestion]] occurs.}}

{{term|[[Coase conjecture]]}}
{{defn|A model in which a monopolist must sell its product at a low price because it is effectively in competition with itself over multiple periods. It is assumed that the monopolist sells a durable good to a market where resale is impossible, faces an infinite time horizon, faces consumers who have different valuations, and does not know individuals' valuations.}}

{{term|[[Coase theorem]]}}
{{defn|States that if the provision of a good or service results in an externality and trade in that good or service is possible, then bargaining will lead to a [[Pareto efficiency|Pareto efficient]] outcome regardless of the initial allocation of property. This requires sufficiently low [[transaction costs]] in the bargaining and exchange process.}}

{{term|[[cobweb model]]}}
{{ghat|Also called '''cobweb theory'''.}}
{{defn|A model which describes cyclical [[supply and demand]] in a market where the amount produced must be chosen before prices are observed. Producers' [[Expected value|expectation]]s about prices are assumed to be based on observations of previous prices. It explains why [[price]]s may be subjected to periodic fluctuations in certain types of [[Market (economics)|market]]s.}}

{{term|[[collateral loan]]}}
{{defn|Also known as a secured loan, it is a loan where the borrower pledges an asset to a financial institution to access funds. The asset, called collateral, protects the lender from possible defaulting as they would take ownership in case of default.}}

{{term|[[collective action]]}}
{{defn|Any action taken together [[Advocacy group|by a group of people]] whose [[goal]] is to enhance their condition and achieve a common objective.<ref>{{cite web|url=http://www.britannica.com/EBchecked/topic/1917157/collective-action-problem|title=collective action problem – collective action|website=Encyclopædia Britannica}}</ref>}}

{{term|[[collective action problem]]}}
{{ghat|Also called '''social dilemma'''}}
{{defn|A situation in which all individuals would be better off cooperating but fail to do so because of conflicting interests between individuals that discourage joint action.<ref>{{Cite book|chapter-url=http://www.oxfordreference.com/view/10.1093/acref/9780199670840.001.0001/acref-9780199670840-e-223|title=Collective action problem – Oxford Reference|volume=1|language=en|doi=10.1093/acref/9780199670840.001.0001|access-date=2018-04-11|isbn=9780199670840|chapter=Collective action problem|publisher=Oxford University Press|date=2018-01-18|editor1-last=Brown|editor1-first=Garrett|editor2-first=Iain|editor2-last=McLean|editor3-first=Alistair|editor3-last=McMillan}}</ref><ref>Erhard Friedberg, "Conflict of Interest from the Perspective of the Sociology of Organized Action" in ''Conflict of Interest in Global, Public and Corporate Governance'', Anne Peters & Lukas Handschin (eds), Cambridge University Press, 2012</ref><ref>{{cite journal | last1 = Allison | first1 = S. T. | last2 = Beggan | first2 = J. K. | last3 = Midgley | first3 = E. H. | year = 1996 | title = The quest for "similar instances" and "simultaneous possibilities": Metaphors in social dilemma research | doi =10.1037/0022-3514.71.3.479 | journal = Journal of Personality and Social Psychology | volume = 71 | issue = 3| pages = 479–497 }}</ref>}}

{{term|[[collusion]]}}
{{defn|A deceitful agreement or secret cooperation between two or more parties to limit open competition by deceiving, misleading or defrauding others of their legal right.}}

{{term|[[command economy]]}}
{{defn|An economy in which the government directs all economic activity.}}

{{term|commerce}}
{{defn|Relates to "the exchange of [[goods and services]], especially on a large scale".<ref>{{cite web
|url=http://www.oxforddictionaries.com/definition/english/commerce
|archive-url=https://web.archive.org/web/20120711192954/http://oxforddictionaries.com/definition/english/commerce
|url-status=dead
|archive-date=July 11, 2012
|work=English: Oxford Living Dictionaries
|title=commerce 
|publisher=Oxford University Press
|quote =  '''1''' The activity of buying and selling, especially on a large scale.
|date=n.d. |access-date=December 11, 2018}}</ref> It includes legal, economic, political, social, cultural and technological [[system]]s that operate in a country or in [[international trade]].}}

{{term|[[commodity]]}}
{{defn|An economic good or service that has full or substantial [[fungibility]]: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them.<ref>{{cite web|url=http://beginnersinvest.about.com/cs/commodities/f/whatcommodities.htm|archive-url=https://archive.today/20040908123119/http://beginnersinvest.about.com/cs/commodities/f/whatcommodities.htm|url-status=dead|archive-date=September 8, 2004|title=Learn What Commodities Are in These Examples!}}</ref>}}

{{term|[[communism]]}}
{{defn|An ideology centered around [[common ownership]] of the [[means of production]], distribution, and exchange that allocates products to everyone in the society based on need.<ref>{{cite book |last=Ely |first=Richard T |title=French and German socialism in modern times |date=1883 |publisher=[[Harper & Brothers]] |location=New York |pages=35–36 |oclc=456632 |quote=All communists without exception propose that the people as a whole, or some particular division of the people, as a village or commune, should own all the means of production—land, houses, factories, railroads, canals, etc.; that production should be carried on in common; and that officers, selected in one way or another, should distribute among the inhabitants the fruits of their labor.}}</ref><ref>{{cite book |last1=Bukharin |first1=Nikolai |title=[[The ABC of Communism]] |last2=Preobrazhensky |first2=Yevgeni |date=1922 |publisher=[[Communist Party of Great Britain]] |location=London, England |pages=72–73, § 20 |translator-last1=Paul |translator-first1=Cedar |chapter=Distribution in the communist system |author1-link=Nikolai Bukharin |author2-link=Yevgeni Preobrazhensky |access-date=18 August 2021 |orig-date=1920 |translator-last2=Paul |translator-first2=Eden |translator-link1=Cedar Paul |translator-link2=Eden Paul |chapter-url=https://www.marxists.org/archive/bukharin/works/1920/abc/ABC-of-Communism.pdf#page=67 |via=[[Marxists Internet Archive]]}}</ref><ref name="Steele p.43">{{cite book |last=Steele |first=David R. |date=1992 |title=From Marx to Mises: Post-Capitalist Society and the Challenge of Economic Calculation |publisher=Open Court Publishing Company |isbn=978-0-87548-449-5 |page=43 |quote= One widespread distinction was that socialism socialised production only while communism socialised production and consumption.}}</ref>}}
{{term|[[comparative advantage]]}}
{{ghat|Also called '''opportunity cost advantage'''.}}
{{defn|The ability to produce most efficiently given all of the other products that could be produced.}}

{{term|[[compensating differential]]}}
{{ghat|Also called '''compensating wage differential''' or '''equalizing difference'''.}}
{{defn|The additional amount of income that a given worker must be offered to motivate them to accept a given undesirable job, relative to other jobs that worker could perform.<ref>{{cite book |last1=Kaufman |first1=Bruce E. |first2=Julie L. |last2=Hotchkiss |year=2005 |chapter=Education, Training, and Earnings Differentials: The Theory of Human Capital |title=The economics of labor markets |edition=5th |publisher=Harcourt College Publishers |isbn=978-0-324-28879-7 }}</ref><ref name="Rosen">{{cite book |last=Rosen |first=Sherwin |year=1986 |chapter=The theory of equalizing differences |editor1-first=Orley |editor1-last=Ashenfelter |editor2-first=Richard |editor2-last=Layard |title=The Handbook of Labor Economics |volume=1 |pages=641–692 |location=New York |publisher=Elsevier |isbn=978-0-444-87856-4 }}</ref>}}

{{term|Competition (CD or COD)}}
{{defn|The presence in a market of independent buyers and sellers competing with one another and the freedom of buyers and sellers to enter and leave the market.}}

{{term|[[competition law]]}}
{{ghat|Also called an '''antitrust law''' or '''anti-monopoly law'''.}}
{{defn|Any law that promotes or seeks to maintain [[market competition]] by regulating [[anti-competitive]] conduct by companies.<ref name="papers.ssrn.com"/><ref name="Taylor 2006 1"/>}}

{{term|[[competitive market]]}}
{{defn|A market in which many sellers compete against each
other to attract customers. Each seller has an incentive to sell at the lowest
price possible to attract customers, so prices tend to be driven so low that
the sellers can just barely make a profit.}}

{{term|[[complementary goods]]}}
{{defn|{{gli|good|Goods}} that are bought and used together.}}

{{term|[[complex multiplier]]}}
{{defn|The multiplier by which a change in autonomous expenditure changes the equilibrium income in an economy.}}

{{term|[[compound interest]]}}
{{defn|The addition of {{gli|interest}} to the principal sum of a {{gli|loan}} or {{gli|deposit}}; it is often interpreted as "interest on interest". Compound interest is the result of reinvesting interest, rather than paying it out, so that interest in the next period is then earned on the principal sum plus any previously accumulated interest. Contrast ''{{gli|simple interest}}''.}}

{{term|[[computable general equilibrium]] (CGE)}}
{{ghat|Also called '''applied general equilibrium (AGE)'''.}}
{{defn|A class of economic models that use actual economic data to estimate how an economy might react to changes in policy, technology, or other external factors.}}
 
{{term|[[computational economics]]}}
{{defn|A research discipline at the interface of economics, [[computer science]], and [[management science]]<ref name="compecon">''Computational Economics''. 
"[https://www.springer.com/economics/economic+theory/journal/10614 "About This Journal"] and [https://www.springer.com/economics/economic+theory/journal/10614?changeHeader "Aims and Scope]."</ref> which encompasses [[computational modeling]] of {{gli|economic system|economic systems}}, whether [[agent-based computational economics|agent-based]],<ref name="Page2008">Scott E. Page, 2008. "agent-based models," ''[[The New Palgrave Dictionary of Economics]]'', 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_A000218&edition=current&q=agent-based%20computational%20modeling&topicid=&result_number=1 Abstract].</ref> [[general equilibrium|general-equilibrium]],<ref>''[[The New Palgrave Dictionary of Economics]]'', 2008. 2nd Edition:<br/>&nbsp; • "computation of general equilibria" by [[Herbert Scarf|Herbert E. Scarf]]. [http://www.dictionaryofeconomics.com/article?id=pde2008_C000573&q=computational%20economics&topicid=&result_number=3 Abstract.]<br/>&nbsp; • "computation of general equilibria (new developments)" by Felix Kubler. [http://www.dictionaryofeconomics.com/article?id=pde2008_C000564&q=computational%20economics&topicid=&result_number=2 Abstract].</ref> [[Macroeconomic model|macroeconomic]],<ref>• Hans M. Amman, David A. Kendrick, and John Rust, ed., 1996. ''Handbook of Computational Economics'', v. 1, ch. 1–6, preview [http://www.sciencedirect.com/science?_ob=PublicationURL&_hubEid=1-s2.0-S1574002196X0100X&_cid=273377&_pubType=HS&_auth=y&_acct=C000228598&_version=1&_urlVersion=0&_userid=10&md5=5c01eea1053bbec507ddeee3c8e8a68e links] {{Webarchive|url=https://archive.today/20120909024330/http://www.sciencedirect.com/science?_ob=PublicationURL&_hubEid=1-s2.0-S1574002196X0100X&_cid=273377&_pubType=HS&_auth=y&_acct=C000228598&_version=1&_urlVersion=0&_userid=10&md5=5c01eea1053bbec507ddeee3c8e8a68e |date=2012-09-09 }}.</ref> or [[rational expectations|rational-expectations]],<ref>[[Ray C. Fair]] "Computational Methods for Macroeconometric Models," Hans M. Amman, David A. Kendrick, and John Rust, ed., 1996. ''Handbook of Computational Economics'', v. 1, ch., pp. 143–169. [http://www.sciencedirect.com/science/article/pii/S1574002196010052 Outline].</ref> computational {{gli|econometrics}} and statistics,<ref>• Vassilis A. Hajivassiliou, 2008. "computational methods in econometrics," ''[[The New Palgrave Dictionary of Economics]]'', 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_C000559&q=Computation&topicid=&result_number=1 Abstract.]<br/>&nbsp;&nbsp; • Keisuke Hirano, 2008. "decision theory in econometrics," ''The New Palgrave Dictionary of Economics'', 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_D000244&edition=current&q=Computational%20economics&topicid=&result_number=19 Abstract].<br/>&nbsp;&nbsp; • [[James O. Berger]], 2008. "statistical decision theory," ''The New Palgrave Dictionary of Economics'', 2nd Edition.  [http://www.dictionaryofeconomics.com/article?id=pde2008_S000251&edition=&field=keyword&q=statistical%20decision%20theory&topicid=&result_number=1 Abstract.]</ref> [[computational finance]], computational tools for the design of automated [[internet economy|internet market]]s, programming tools specifically designed for computational economics, and pedagogical tools for the teaching of computational economics.}}

{{term|[[concentration ratio]]}}
{{defn|The sum of the percentage market shares of (a pre-specified number of) the largest firms in an industry, which is used to quantify [[market concentration]] in an industry.}}

{{term|[[conspicuous consumption]]}}
{{defn|The consumer practice of buying and using goods of a higher quality, [[price]], or in greater quantity than practical.<ref>Phillips, Ronnie J.  2014 April 22. "[https://www.britannica.com/topic/conspicuous-consumption Conspicuous consumption]." ''Encyclopedia Britannica''.</ref>}}

{{term|[[conspicuous consumption|conspicuous compassion]]}}
{{defn|The ostentatious use of charity meant to enhance the [[reputation]] and social prestige of the donor.<ref name="West 2004">{{cite book |last=West |first=Patrick |title=Conspicuous Compassion: Why Sometimes It Really Is Cruel To Be Kind |location=London |publisher=Civitas, Institute for the Study of Civil Society |year=2004 |isbn=978-1-903386-34-7 }}</ref>}}

{{term|consumer}}
{{defn|A member of a household that spends on goods and services.}}

{{term|[[consumer choice]]}}
{{defn|A theory of {{gli|microeconomics}} that relates {{gli|preference|preferences}} to consumption expenditures and to [[supply and demand|consumer demand curves]]. It analyzes how consumers maximize the desirability of their consumption as measured by their preferences subject to limitations on their expenditures, by maximizing {{gli|utility}} subject to a consumer {{gli|budget constraint}}.<ref>{{Cite news|url=http://www.ecnmy.org/learn/your-home/consumption/what-is-consumer-choice-theory/|title=What is 'consumer choice theory'? — Economy|work=Economy|access-date=2017-05-31|language=en-GB}}</ref>}}

{{term|[[consumer confidence]]}}
{{defn|An {{gli|economic indicator}} that measures the degree of optimism that {{gli|consumer|consumers}} feel about the overall state of the {{gli|economy}} and their [[Personal finance|personal financial]] situation.}}

{{term|[[consumer credit]]}}
{{defn|A loan afforded to a consumer for the payment of goods and services which they will have to repay to the lender over time usually plus interest.}}

{{term|[[consumer price index]] (CPI)}}
{{defn|Measures changes in the price level of [[market basket]] of [[Goods|consumer goods]] and [[Services marketing|services]] purchased by households.
The CPI is a statistical estimate constructed using the prices of a sample of representative items whose prices are collected periodically. Sub-indices and sub-sub-indices are computed for different categories and sub-categories of goods and services, being combined to produce the overall index with weights reflecting their shares in the total of the consumer expenditures covered by the index. It is one of several [[price index|price indices]] calculated by most national statistical agencies. The annual percentage change in a CPI is used as a measure of {{gli|inflation}}. A CPI can be used to index (i.e. adjust for the effect of inflation) the real value of wages, salaries, and pensions; to regulate prices; and to deflate monetary magnitudes to show changes in real values. In most countries, the CPI, along with the population census, is one of the most closely watched national economic statistics.}}

{{term|[[consumer surplus]]}}
{{defn|the difference between the maximum price a consumer is willing to pay and the actual price they do pay. If a consumer is willing to pay more for a unit of a good than the current asking price, they are getting more benefit from the purchased product than they would if the price was their maximum willingness to pay. They are receiving the same benefit, the obtainment of the good, with a smaller cost as they are spending less than they would if they were charged their maximum willingness to pay.<ref>{{Cite encyclopedia | doi=10.1057/978-1-349-95121-5_626-2| chapter=Consumer Surplus| encyclopedia=The New Palgrave Dictionary of Economics| pages=1–7| year=2008| last1=Slesnick| first1=Daniel T.| isbn=978-1-349-95121-5}}</ref> }}

{{term|[[consumerism]]}}
{{defn|Economic policies which emphasize {{gli|consumption}}.}}
  
{{term|[[Consumption (economics)|consumption]]}}
{{defn|According to [[mainstream economics|mainstream economists]], only the final purchase of {{gli|good|goods}} and {{gli|service|services}} by individuals constitutes consumption, while other types of expenditure—in particular, [[fixed investment]], [[intermediate consumption]], and government spending—are placed in separate categories (see ''{{gli|consumer choice}}''). Other economists define consumption much more broadly, as the aggregate of all economic activity that does not entail the design, production and marketing of goods and services (e.g. the selection, adoption, use, disposal and recycling of goods and services).}}

{{term|[[consumption function]]}}
{{defn|A mathematical function which describes a relationship between {{gli|consumption}} and {{gli|disposable income}}.<ref>Algebraically, this means <math>C = f(Y_{d})</math> where <math>f \colon \mathbb{R}^{+} \to \mathbb{R}^{+}</math> is a [[Function (mathematics)|function]] that [[Map (mathematics)|maps]] levels of disposable income <math>Y_{d}</math>—income after government intervention, such as taxes or transfer payments—into levels of consumption <math>C</math>.</ref><ref>{{cite book |first=John |last=Lindauer |author-link=John Lindauer |title=Macroeconomics |location=New York |publisher=John Wiley & Sons |edition=Third |year=1976 |isbn=978-0-471-53572-0 |pages=40–43 }}</ref> The concept is believed to have been introduced into {{gli|macroeconomics}} by [[John Maynard Keynes]] in 1936, who used it to develop the notion of a [[Fiscal multiplier|government spending multiplier]].<ref>{{cite book |last1=Hall |first1=Robert E. |author-link=Robert Hall (economist) |last2=Taylor |first2=John B. |author2-link=John B. Taylor |chapter=Consumption and Income |pages=63–67 |title=Macroeconomics: Theory, Performance, and Policy |location=New York |publisher=W. W. Norton |year=1986 |isbn=978-0-393-95398-5 }}</ref>}}

{{term|[[contract curve]]}}
{{defn|In [[microeconomics]], the '''contract curve''' is the set of points representing final allocations of two goods between two people that could occur as a result of mutually beneficial trading between those people given their initial allocations of the goods. All the points on this locus are [[Pareto efficient]] allocations, meaning that from any one of these points there is no reallocation that could make one of the people more satisfied with his or her allocation without making the other person less satisfied. The contract curve is the subset of the Pareto efficient points that could be reached by trading from the people's initial holdings of the two goods.}}

{{term|[[contract theory]]}}
{{defn|The study of how economic actors can and do construct contractual arrangements, generally in the presence of [[asymmetric information]]. Because of its connections with both [[agency (law)|agency]] and [[incentive]]s, contract theory is often categorized within a field known as [[law and economics]].}}

{{term|[[Convergence (economics)|convergence]]}}
{{ghat|Also called the '''catch-up effect'''.}}
{{defn|The hypothesis that poorer [[Economic system|economies]]' per capita incomes will tend to grow at faster rates than richer economies.}}

{{term|[[Convexity in economics|convexity]]}}
{{defn|In the [[Arrow–Debreu model]] of [[general equilibrium|general economic equilibrium]], agents have convex {{gli|budget set|budget sets}} and [[convex preferences]]: at {{gli|equilibrium}} prices, the budget [[supporting hyperplane|hyperplane supports]] the best attainable [[indifference curve]].<ref name="Newman1987d" >{{harvtxt|Newman|1987d}}</ref> The [[profit (economics)|profit function]] is the [[convex conjugate]] of the [[Cost curve|cost function]].<ref name="Newman, Peter p. 1">Newman, Peter (1987c). "Convexity". In Eatwell, John; Milgate, Murray; Newman, Peter (eds.). The New Palgrave: A Dictionary of Economics (first ed.). Palgrave Macmillan. p. 1. {{doi|10.1057/9780230226203.2282}}. {{ISBN|9780333786765}}.</ref><ref>{{cite book |last=Newman |first=Peter |author-link=Peter Kenneth Newman |chapter=Duality |title=The New Palgrave: A Dictionary of Economics |editor1-first=John |editor1-last=Eatwell |editor2-first=Murray |editor2-last=Milgate |editor3-first=Peter |editor3-last=Newman |editor3-link=Peter Kenneth Newman |publisher=Palgrave Macmillan |year=1987d |edition=first |doi=10.1057/9780230226203.2412<!-- SNAFU at NP? 30 Jan 2011--> |pages=1 |chapter-url=http://www.dictionaryofeconomics.com/article?id=pde1987_X000626 |isbn=9780333786765}}</ref> [[Convex analysis]] is the standard tool for analyzing textbook economics.<ref name="Newman, Peter p. 1" /> Non‑convex phenomena in economics have been studied with [[subgradient|nonsmooth analysis]], which generalizes [[convex analysis]].<ref>Khan, M. Ali (2008). "Perfect competition". In Durlauf, Steven N.; Blume, Lawrence E., ed. (eds.). The New Palgrave Dictionary of Economics (Second ed.). Palgrave Macmillan. pp. 354–365. {{doi|10.1057/9780230226203.1267}}. {{ISBN|978-0-333-78676-5}}</ref>}}

{{term|[[coordination good]]}}
{{defn|A [[good (economics)|good]] created by the coordination of people within [[civil society]].<ref>{{cite web|url=https://www.nytimes.com/2005/08/16/opinion/16iht-edmesquita.html|title=An open economy, a closed society|first1=Bruce Bueno de |last1=Mesquita|author1link=Bruce Bueno de Mesquita|first2=George W.|last2=Downs|author2link=George W. Downs (political scientist)|date=August 17, 2005|work=New York Times}}</ref> Coordination goods are non-[[Rivalry (economics)|rivalrous]], but may be partially [[Excludability|excludable]] through the means of withholding cooperation from a non-cooperative state.<ref>{{cite web|url=http://faculty.ucc.edu/egh-damerow/global_commons.htm|title=Global Commons, Collective Goods, Free Riders, and Destruction of the Commons|accessdate=2014-12-23|archive-url=https://web.archive.org/web/20160304023511/http://faculty.ucc.edu/egh-damerow/global_commons.htm|archive-date=2016-03-04|url-status=dead}}</ref>}}

{{term|[[corporate tax]]}}
{{ghat|Also called '''corporation tax''' or '''company tax'''.}}
{{defn|A type of [[direct tax]] levied on the income or capital of corporations and other similar legal entities.}}

{{term|corporation}}
{{defn|A type of business organization owned by many people but treated by law as though it were an individual person; it can own property, pay taxes, make contracts, and contribute to political causes.}}

{{term|[[cost]]}}
{{defn|no=1|The value of {{gli|money}} that is used up to produce a {{gli|good}} or deliver a {{gli|service}}, and hence is no longer available for further use. In business, the cost may be one of acquisition, in which case the amount of money expended to acquire a good or service is counted as the cost; in this case, money is the input that is gone to acquire the thing. This acquisition cost may be the sum of the cost of production as incurred by the original producer and of further costs of transaction as incurred by the acquirer over and above the {{gli|price}} paid to the producer. Usually, the price designated by the producer also includes a mark-up for {{gli|profit}} over the cost of production.}}
{{defn|no=2|More generally, a [[performance metric]] that is totaling up as a result of a process or as a differential for the result of a [[Decision making|decision]].<ref>{{cite book| last1 = O'Sullivan| first1 = Arthur| author-link = Arthur O'Sullivan (economist)| first2 = Steven M. | last2 = Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2022| location = Paramus, New Jersey| page = 16| isbn = 978-0-13-063085-8}}</ref> Hence cost is the metric used in the standard [[Business process modelling|modeling]] paradigm applied to economic [[Business process|processes]]. Costs (pl.) are often further described based on their timing or their applicability.}}

{{term|[[cost curve]]}}
{{defn|A graph of the [[costs of production]] as a function of total quantity produced. In a {{gli|free market}} economy, {{gli|productive efficiency|productively efficient}} firms optimize their production process by minimizing cost consistent with each possible level of production, and the result is a cost curve; and {{gli|profit maximization|profit maximizing}} firms use cost curves to decide output quantities. There are various types of cost curves, all related to each other, including total and average cost curves; marginal ("for each additional unit") cost curves, which are equal to the [[Differentiation (mathematics)|differential]] of the total cost curves; and variable cost curves. Some are applicable to the [[short run]], others to the [[long run]].}}

{{term|[[cost of living]]}}
{{defn|The {{gli|cost}} of maintaining a certain [[standard of living]]. Changes in the cost of living over time are often operationalized in a [[cost-of-living index]]. Cost of living calculations are also used to compare the cost of maintaining a certain standard of living in different geographic areas. Differences in cost of living between locations can also be measured in terms of {{gli|purchasing power parity}} rates.}}

{{term|[[cost overrun]]}}
{{ghat|Also called '''cost increase''' or '''budget overrun'''.}}
{{defn|A situation involving unexpected incurred {{gli|cost|costs}}. A cost overrun occurs when an underestimation of the actual cost during budgeting results in costs that are in excess of budgeted amounts.}}

{{term|[[cost the limit of price]]}}
{{defn|A maxim indicating a (prescriptive) version of the [[labor theory of value]]. It suggests that the price of a good should be equal to its cost, implying that [[profit (economics)|profit]], [[renting|rent]], and interest could be considered unjust economic arrangements.}}

{{term|[[Cournot competition]]}}
{{defn|A model used to describe an industry structure in which companies compete on the amount of output they will produce, which they decide on independently of each other and at the same time.}}

{{term|[[cost-benefit analysis]] (CBA)}}
{{ghat|Sometimes called '''benefit costs analysis (BCA)'''.}}
{{defn|A systematic approach to estimating the strengths and weaknesses of alternative options (for example in {{gli|transaction|transactions}}, activities, or functional business requirements). It is often used to determine the option or options that provide the best approach to achieve benefits while preserving savings.<ref>{{cite journal|last1=David|first1=Rodreck|last2=Ngulube|first2=Patrick|last3=Dube|first3=Adock|title=A cost-benefit analysis of document management strategies used at a financial institution in Zimbabwe: A case study|journal=SA Journal of Information Management|date=16 July 2013|volume=15|issue=2|doi=10.4102/sajim.v15i2.540|doi-access=free}}</ref> Cost-benefit analysis may be used to compare potential (or completed) courses of actions, or estimate (or evaluate) the value against {{gli|cost|costs}} of a single decision, project, or policy. Common areas of application include commercial transactions, functional business decisions, policy decisions (especially [[government policy]]), and project investments.}}

{{term|[[cost-of-production theory of value]]}}
{{defn|The theory that the {{gli|price}} of an object or condition is determined by the sum of the {{gli|cost}} of the resources that went into producing it. The cost can comprise any of the {{gli|factors of production}} (including labor, capital, or land) as well as [[Effect of taxes and subsidies on price|taxation]].}}

{{term|[[cost-push inflation]]}}
{{defn|A purported type of inflation caused by increases in the cost of important [[good (economics)|goods]] or services where no suitable alternative is available. As businesses face higher prices for underlying inputs, they are forced to increase prices of their outputs.}}

{{term|[[credit bureau]]}}
{{defn|An agency that tracks the {{gli|credit}}, employment, and housing history of {{gli|consumer|consumers}} and assigns them a {{gli|credit score}}.}}

{{term|credit card}}
{{defn|A [[payment card]] issued to users (cardholders) to enable the cardholder to pay a {{gli|merchant}} for {{gli|good|goods}} and {{gli|service|services}} based on the cardholder's promise to the [[credit card issuer|card issuer]] to pay them at a later time for the cost of the good or service plus other agreed-upon fees and charges.<ref>{{cite book| last = O'Sullivan| first = Arthur| author-link = Arthur O'Sullivan (economist)|author2=Steven M. Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2003| location = Upper Saddle River, New Jersey| page = 261| isbn = 0-13-063085-3|type=Textbook}}</ref> The card issuer (usually a bank) creates a [[revolving account]] and grants a {{gli|line of credit}} to the cardholder, from which the cardholder can borrow money for payment to a merchant or as a [[cash advance]].}}

{{term|[[credit score]]}}
{{defn|A numerical value assigned to a person's potential ability to repay {{gli|debt}}. A good credit score in the United States is approximately 700.}}

{{term|[[credit rating]]}}
{{defn|An evaluation of the [[credit risk]] of a prospective {{gli|debtor}} (an individual, business, company, or government), predicting their ability to pay back the debt, and an implicit forecast of the likelihood of the debtor [[Default (finance)|defaulting]] on the debt.<ref>{{cite book| last = Kronwald| first = Christian| title = Credit Rating and the Impact on Capital Structure| publisher = Druck und Bingdung| year = 2009| location = Norderstedt, Germany| page = 3| url = https://books.google.com/books?id=CzjS5YV5nK8C&q=%22credit%20rating%22| isbn = 978-3-640-57549-7}}</ref> Credit rating represents an evaluation of a [[credit rating agency]] of the qualitative and quantitative information for the prospective debtor, including information provided by the prospective debtor and other non-public information obtained by the credit rating agency's analysts. A subset of credit rating called credit reporting or {{gli|credit score}} is a numeric evaluation of an individual's credit worthiness, which is conducted by a {{gli|credit bureau}} or [[consumer credit reporting agency]].}}

{{term|[[credit union]]}}
{{defn|A {{gli|financial institution}} that is usually local and owned by its members.}}

{{term|[[creditor]]}}
{{defn|A person or a firm that lends money to a {{gli|debtor|borrower}}.}}

{{term|[[crisis theory]]}}
{{defn|A set of theories concerning the causes<ref>"[https://www.marxists.org/archive/hilferding/1910/finkap/ch17.htm The causes of crises"] in [[Rudolf Hilferding]] [1910] [https://www.marxists.org/archive/hilferding/1910/finkap/ ''Finance Capital. A Study of the Latest Phase of Capitalist Development''. Part IV. ''Finance capital and crises''].</ref> and consequences of the [[Tendency of the rate of profit to fall|tendency for the rate of profit to fall]] in a [[capitalism|capitalist system]].}}

{{term|[[criticism of capitalism]]}}
{{defn|A critique of [[political economy]] that involves the rejection of, or dissatisfaction with the economic system of [[capitalism]] and its outcomes.}}

{{term|[[critique of work]]}}
{{defn|}}

{{term|[[cross elasticity of demand]] (XED)}}
{{defn|Measures the sensitivity of a good's demand to the price of a different good.}}

{{term|[[Crowding out (economics)|crowding out]]}}
{{defn|A phenomenon that occurs when increased government involvement in a sector of a {{gli|market economy}} substantially affects the remainder of the market, either on the {{gli|supply}} or {{gli|demand}} side of the market.}}

{{term|[[crowding-in effect]]}}
{{defn|An increase in private investment that results from government spending. It occurs because public investment makes the private sector more productive, as well as because government spending may have a stimulative effect on the economy.}}

{{term|[[cultural economics]]}}
{{defn|The branch of {{gli|economics}} that studies the relationship between culture and economic outcomes. Here, "culture" is defined by shared beliefs and preferences of respective groups. Programmatic issues include whether and how much culture matters to economic outcomes and what its relation is to [[institutional economics|institutions]].<ref>Press '''+''' button or  '''ctrl +''' for  small-font links below.<br />&nbsp;&nbsp; • [[Raquel Fernández]], 2008. "culture and economics." ''[[The New Palgrave Dictionary of Economics]]'', 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_E000282&q=culture&topicid=&result_number=1 Abstract] and pre-publication [http://homepages.nyu.edu/~rf2/Research/palgravePaperFinal.pdf copy.] {{Webarchive|url=https://web.archive.org/web/20110607005501/http://homepages.nyu.edu/~rf2/Research/palgravePaperFinal.pdf |date=2011-06-07 }}<br />&nbsp;&nbsp; • [[Luigi Guiso]], [[Paola Sapienza]], and [[Luigi Zingales]], 2006. "Does Culture Affect Economic Outcomes?," ''Journal of Economic Perspectives'', 20(2), pp. [http://www.eui.eu/Personal/Guiso/CV/Papers/JEP20_2_2006.pdf 23–48] {{webarchive|url=https://web.archive.org/web/20110929161814/http://www.eui.eu/Personal/Guiso/CV/Papers/JEP20_2_2006.pdf |date=2011-09-29 }}.<br />&nbsp;&nbsp; • Victor A. Ginsburgh & David Throsby ed., 2006, ''Handbook of the Economics of Art and Culture'', v. 1:<br />&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mark Casson. "Culture and Economic Performance,"  Chapter 12, pp. 359–97. {{doi|10.1016/S1574-0676(06)01012-X}}<br />&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;  Paul Streeten. "Culture and Economic Development," Chapter 13,   pp. 399–412. {{doi|10.1016/S1574-0676(06)01013-1}}<br />&nbsp;&nbsp; • Jeanette D. Snowball, 2008. ''Measuring the Value of Culture'', Springer. [https://www.springer.com/economics/microeconomics/book/978-3-540-74355-2 Description] and Arrow-page searchable [https://books.google.com/books?id=IJjLOjHmz6AC chapter links.]<br />&nbsp;&nbsp; • [[Joseph Henrich]] et al., 2005. "'Economic Man' in Cross-Cultural Perspective: Behavioral Experiments in 15 Small-scale Societies," ''Behavioral and Brain Sciences'', 28(6), pp. 795–815. {{doi|10.1017/S0140525X05000142}}<br />&nbsp;&nbsp; • [[Samuel Bowles (economist)|Samuel Bowles]],  1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," ''Journal of Economic Literature'', 36(1), pp. 75–111. {{JSTOR|2564952}}<br />&nbsp;&nbsp; • [[Guido Tabellini]], 2008. "Institutions and Culture," ''Journal of the European Economic Association'', 6(2/3), 2008), pp. 255–94. {{doi|10.1162/JEEA.2008.6.2-3.255}}</ref> As a growing field in {{gli|behavioral economics}}, the role of culture in economic behavior is increasingly being demonstrated to cause significant differentials in decision-making and the management and valuation of {{gli|asset|assets}}.}}

{{term|currency}}
{{defn|{{gli|money|Money}} in any form when in actual use or circulation as a {{gli|medium of exchange}}, especially circulating [[banknote]]s and [[coin]]s.<ref>{{cite encyclopedia | url = http://www.thefreedictionary.com/currency | title = Currency | dictionary = The Free Dictionary}}</ref><ref name=Bernstein>{{cite book |last =Bernstein |first =Peter |author-link =Peter L. Bernstein |title=A Primer on Money, Banking and Gold | edition = 3rd |year=2008 |orig-year=1965 |publisher=Wiley |location=Hoboken, NJ  |isbn=978-0-470-28758-3 |oclc = 233484849 |chapter= 4–5}}</ref> A more general definition is that a currency is a "{{gli|monetary system|system}}" of money (monetary units) in common use, especially within a particular nation.}}

{{term|[[Current account (balance of payments)|current account]]}}
{{defn|A country's current account is one of the two components of its [[balance of payments]], the other being the [[capital account]] (also known as the financial account). The current account consists of the [[balance of trade]], net ''primary income'' or ''factor income'' (earnings on foreign investments minus payments made to foreign investors) and net cash transfers, that have taken place over a given period of time. The current account balance is one of two major measures of a country's foreign trade (the other being the [[net capital outflow]]). A current account surplus indicates that the value of a country's net foreign assets (i.e. assets less liabilities) grew over the period in question, and a current account deficit indicates that it shrank. Both government and private payments are included in the calculation. It is called the current account because {{gli|good|goods}} and {{gli|service|services}} are generally consumed in the current period.<ref name="Ecological Economics">''Ecological Economics: Principles And Applications''. Herman E. Daly, Joshua Farley; Island Press, 2003</ref><ref name="IMF_2012">{{cite web|url=http://www.imf.org/external/pubs/ft/fandd/basics/current.htm| title=Current Account Deficits: Is There a Problem?| publisher=International Monetary Fund| date=28 March 2012| access-date=24 December 2015| author1=Ghosh, Atish| author2=Ramakrishnan, Uma}}</ref>}}

{{term|[[cyclical unemployment]]}}
{{defn|{{gli|unemployment|Unemployment}} resulting from the {{gli|business cycle}}. It is unpredictable.}}
{{glossaryend}}

==D==
{{glossary}}
{{term|[[DAD–SAS model]]}}
{{defn|A macroeconomic model based on the AD-AS model, but examining the relationship between inflation and income, rather than price level and income. DAD is short for Dynamic Aggregate Demand, and SAS is short for Surprise Aggregate Supply.}}

{{term|[[dead cat bounce]]}}
{{ghat|Also called '''sucker rally'''.}} 
{{defn|A small, brief recovery in the price of a declining asset.<ref>{{cite web |title=Definition of dead-cat bounce {{!}} Dictionary.com |url=https://www.dictionary.com/browse/dead-cat-bounce |website=www.dictionary.com |access-date=30 April 2022 |language=en}}</ref>}}

{{term|[[deadweight loss]]}}
{{ghat|Also called '''excess burden''' or '''allocative inefficiency'''.}} 
{{defn|A loss of {{gli|economic efficiency}} that occurs when the free-market {{gli|economic equilibrium|equilibrium}} for a {{gli|good}} or {{gli|service}} is not achieved. Deadweight loss can be caused by {{gli|monopoly}} pricing in the case of {{gli|artificial scarcity}}, an {{gli|externality}}, a [[effect of taxes and subsidies on price|tax or subsidy]], or a compulsory {{gli|price ceiling}} or {{gli|price floor}} such as a {{gli|minimum wage}}.}}

{{term|[[Debreu's representation theorems]]}}
{{defn|A set of [[preference representation theorem]]s proved by [[Gerard Debreu]]. They specify some conditions on the preference relation that guarantee the existence of a representing utility function.}}

{{term|[[debt]]}}
{{defn|Total money owed.}}

{{term|[[debit card]]}}
{{defn|A debit card is a payment card that allows you to make purchases and withdraw cash from your bank account. Debit cards are also known as "check cards." They look and work similarly to credit cards, but they use money that's already in your checking account instead of money you borrow.}}

{{term|[[debtor]]}}
{{defn|An entity that owes a {{gli|debt}} to another entity. The entity may be an individual, a firm, a government, a company, or another [[legal person]]. The [[counterparty]] to which the debt is owed is called a {{gli|creditor}}. When the counterparty of the arrangement is a {{gli|bank}}, the debtor is more often referred to as a {{gli|borrower}}.}}

{{term|[[deficit spending]]}}
{{ghat|Also called '''budget deficit''' or simply '''deficit'''.}}
{{defn|The amount by which spending exceeds {{gli|revenue}} over a particular period of time; it is the opposite of {{gli|budget surplus}}. The term may be applied to the budget of a government, private company, or individual.}}

{{term|[[deflation]]}}
{{defn|A decrease in the general {{gli|price index|price level}} of goods and services.<ref>Robert J. Barro and Vittorio Grilli (1994), ''European Macroeconomics'', chap. 8, p. 142. {{ISBN|0-333-57764-7}}</ref> Deflation occurs when the {{gli|inflation}} rate falls below 0% (a negative inflation rate); though inflation reduces the value of {{gli|currency}} over time, deflation increases it. This allows more goods and services to be bought than before with the same amount of currency. Deflation is distinct from {{gli|disinflation}}, which occurs when the inflation rate decreases but is still positive.<ref>{{Cite book| last1 = O'Sullivan | first1 = Arthur | author-link = Arthur O'Sullivan (economist) | first2 = Steven M. | last2 = Sheffrin | author-link2 = Steven M. Sheffrin | title = Economics | publisher = Savvas Learning Company | year = 2022 | location = Paramus, New Jersey | page = 343 | isbn = 978-0-13-063085-8}}</ref>}}

{{term|[[deflator]]}}
{{defn|A value that allows data to be measured over time in terms of some [[base period]], usually through a {{gli|price index}}, to distinguish between changes in the money value of a {{gli|gross national product}} (GNP) that come from a change in prices, and changes from a change in physical output. It is the measure of the price level for some quantity. A deflator serves as a price index in which the effects of inflation are nulled.<ref>{{cite web|url=http://www.bls.gov/bls/glossary.htm|title=BLS Information |date=February 28, 2008|work=Glossary|publisher=U.S. Bureau of Labor Statistics Division of Information Services |access-date=2009-05-05}}</ref><ref name="umweb">{{cite web|url=http://www-personal.umich.edu/~alandear/glossary/d.html|title=Deardorff's Glossary of International Economics|work=D|publisher=umweb|access-date=2009-05-10}}</ref><ref name="orbex">{{cite web|url=https://www.orbex.com/en/glossary|title=Orbex Financial Glossary|date=November 30, 2014|work=Glossary|publisher=Orbex|access-date=2014-12-02}}</ref> It is the difference between real and nominal GDP.<ref name="forex">{{cite web|url=http://euro.uz/forex/41.htm |title=The forex quick guide for beginners and private traders |year=2008 |publisher=Forex |access-date=2009-05-10 |url-status=dead |archive-url=https://web.archive.org/web/20141130031015/http://euro.uz/forex/41.htm |archive-date=November 30, 2014 }}</ref><ref name="nationalstat">{{cite web|url=http://www.statistics.gov.uk/about/glossary/economic_terms.asp|title=Economic terms|date=7 January 2004|work=Glossary|publisher=National Statistics|access-date=2009-05-10|archive-url=http://webarchive.nationalarchives.gov.uk/20110907093405/http://www.ons.gov.uk/ons/guide-method/geography/beginner-s-guide/glossary/glossary-u.html|archive-date=2011-09-07|url-status=dead}}</ref>}}

{{term|[[deleveraging]]}}
{{defn|A reduction in debt. At the [[microeconomics|micro-economic]] level, it is measured as the reduction of the [[leverage ratio]], or the percentage of [[debt]] in the [[balance sheet]] of a single economic entity, such as a household or a firm. At the [[macroeconomics|macro-economic]] level, it is usually measured as a decline of the total debt to [[nominal GDP|GDP]] ratio in the [[national accounts]].}}

{{term|[[demand]]}}
{{defn|The whole range of quantities that a person or group with a given income and preferences demands at various prices.}}

{{term|[[demand curve]]}}
{{defn|A line on a graph that represents how much of a good or service buyers are going to consume at various prices.}}

{{term|[[demand deposit]]}}
{{defn|Demand deposits, bank money or scriptural money are funds held in [[demand deposit account]]s in [[commercial banks]].<ref>{{cite web |url=http://www.merriam-webster.com/dictionary/bank+money |title=Bank Money: Merriam-Webster Dictionary |publisher=www.merriam-webster.com |access-date=19 August 2009 }}</ref> These account balances are usually considered money and form the greater part of the narrowly defined [[money supply]] of a country.<ref name=Krugman>[[Paul Krugman|Krugman, Paul R.]], and Robin Wells. Economics. New York: Worth, 2006. Print.</ref>}}

{{term|[[demand shock]]}}
{{defn|A sudden event that increases or decreases {{gli|demand}} for {{gli|good|goods}} or {{gli|service|services}} temporarily.}}

{{term|[[demand-pull inflation]]}}
{{defn|A purported type of inflation caused by an increase in aggregate demand greater than the increase in aggregate supply. As real gross domestic product rises and unemployment falls, the economy moves along the [[Phillips curve]] and prices increase.}}

{{term|[[demographic economics]]}}
{{ghat|Also called '''population economics'''.}}
{{defn|The application of economic analysis to [[demography]], the study of human populations, including [[population size|size]], [[population growth|growth]], density, [[population distribution|distribution]], and [[vital statistics (government records)|vital statistics]].<ref name="economic demography">{{cite encyclopedia |doi=10.1057/9780230226203.0428 |entry=Economic Demography |title=The New Palgrave Dictionary of Economics |year=2008 |last1=Kelley |first1=Allen C. |last2=Schmidt |first2=Robert M. |pages=1–12 |isbn=978-0-333-78676-5 |location=London |publisher=Palgrave Macmillan}}</ref><ref>{{cite journal |pmid=12342564 |first=Bernard M. S. |last=van Praag |author-link=Bernard van Praag |journal=Journal of Population Economics |jstor=20007247 |year=1988 |title=The notion of population economics |volume=1 |issue=1 |pages=5–16 |doi=10.1007/bf00171507}}</ref>}}

{{term|[[dependent care plan]]}}
{{defn|A pre-tax account used to pay for either child or adult care while a married couple works, looks for work, or studies.}}

{{term|[[depreciation]]}}
{{defn|The gradual decrease in the economic value of the {{gli|capital stock}} of a firm, nation, or other entity, either through physical depreciation, obsolescence, or changes in the demand for the services of the capital in question. If the capital stock is <math>K_t</math> in one period <math>t</math>, [[gross investment|gross (total) investment]] spending on newly produced capital is <math>I_t</math> and depreciation is <math>D_t</math>, the capital stock in the next period, <math>K_{t+1}</math>, is <math>K_t + I_t - D_t</math>. The net increment to the capital stock is the difference between gross investment and depreciation, and is called {{gli|net investment}}.}}

{{term|[[Depression (economics)|depression]]}}
{{defn|A sustained, long-term decrease in economic activity in one or more economies. It is a more severe economic downturn than a {{gli|recession}}, which is a slowdown in economic activity over the course of a normal {{gli|business cycle}}.}}

{{term|[[deregulation]]}}
{{defn|The process of removing or reducing economic regulations, or the total repeal of governmental [[Economic regulation|regulation of the economy]]. It became common in advanced industrial economies in the 1970s and 1980s, as a result of new trends in economic thinking about the inefficiencies of [[government regulation]], and the risk that regulatory agencies would be controlled by the regulated industry to its benefit, and thereby hurt consumers and the wider economy.}}

{{term|[[Diamond–Dybvig model]]}}
{{defn|A [[Model (economics)|model]] of [[bank run]]s and related [[financial crisis|financial crises]]. The model shows how banks' mix of illiquid assets (such as business or mortgage loans) and liquid liabilities (deposits which may be withdrawn at any time) may give rise to self-fulfilling panics among depositors.}}

{{term|[[differentiated Bertrand competition]]}}
{{defn|A variation of [[Bertrand competition]] where each firm produces a somewhat differentiated product, and consequently faces a demand curve that is downward-sloping for all levels of the firm's price. This provides a solution to the [[Bertrand paradox (economics)]].}}

{{term|[[diminishing marginal utility]]}}
{{defn|A situation where each additional, or marginal, unit of a good or service that is consumed brings less utility than the previous unit.}}

{{term|[[diminishing returns]]}}
{{defn|The decrease in the {{gli|marginalism|marginal}} (incremental) output of a {{gli|production}} process as the amount of a single {{gli|factors of production|factor of production}} is incrementally increased, while the amounts of all other factors of production stay constant. The law of diminishing returns states that in all productive processes, adding more of one factor of production while holding all others constant ("''[[ceteris paribus]]''"), will at some point yield lower incremental per-unit returns.<ref name=Samuelson2001p110>{{cite book |first1=Paul A. |last1=Samuelson |author1-link=Paul Samuelson |first2=William D. |last2=Nordhaus |title=Microeconomics |publisher=McGraw-Hill |year=2001 |isbn=0071180664 |pages=110 |edition=17th}}</ref> It does not imply that adding more of a factor will decrease the ''total'' production, a condition known as '''negative returns''', though in practice this is common.}}

{{term|[[discounting]]}}
{{defn|A mechanism in which a [[debtor]] obtains the right to delay [[payment]]s to a [[creditor]], for a defined period of time, in exchange for a charge or [[fee]].<ref name="Finance_Discount">See "Time Value", "Discount", "Discount Yield", "Compound Interest", "Efficient Market", "Market Value" and "Opportunity Cost" in Downes, J. and Goodman, J. E. ''Dictionary of Finance and Investment Terms'', Baron's Financial Guides, 2003.</ref>  Essentially, the party that owes money in the present purchases the right to delay the payment until some future date.<ref name="Economics_Discount">See "Discount", "Compound Interest", "Efficient Markets Hypothesis", "Efficient Resource Allocation", "Pareto-Optimality", "Price", "Price Mechanism" and "Efficient Market" in Black, John, ''Oxford Dictionary of Economics'', Oxford University Press, 2002.</ref>}}

{{term|[[discrete choice]]}}
{{ghat|Also called '''qualitative choice'''.}}
{{defn|A set of models that describe, explain, and predict choices between two or more [[discrete variable|discrete]] alternatives, such as entering or not entering the [[labor market]], or choosing between modes of transport. These models examine situations in which the potential outcomes are discrete, such that the optimum is not characterized by standard first-order conditions.}}

{{term|[[discretionary income]]}}
{{defn|Money available after one pays {{gli|tax|taxes}} and all other necessary expenses like housing and transportation.}}

{{term|[[disequilibrium macroeconomics]]}}
{{ghat|Also called '''non-Walrasian theory''', '''equilibrium with rationing''', the '''non-market clearing approach''', and '''non-tâtonnement theory'''.}}
{{defn|A tradition of research centered on the role of [[Disequilibrium (economics)|disequilibrium]] in economics.}}

{{term|[[disinflation]]}}
{{defn|A decrease in the rate of {{gli|inflation}}; a slowdown in the rate of increase of the general {{gli|price index|price level}} of goods and services in an economy's {{gli|gross domestic product}} over time. It is the opposite of {{gli|reflation}}. Disinflation is also distinct from {{gli|deflation}}, which occurs when the inflation rate is negative.}}

{{term|[[dispersed knowledge]]}}
{{defn|The notion that no single [[Agent (economics)|agent]] has information as to all of the factors which influence [[prices]] and [[Production (economics)|production]] throughout the system.<ref>{{Cite journal|jstor=1809376|title = The use of knowledge in society|last = Hayek|first = Friedrich|date = 1 September 1945|journal = The American Economic Review|volume = 35|issue=4|pages = 519–530|issn = 0002-8282}}</ref>}}

{{term|[[Disposable and discretionary income|disposable income]]}}
{{defn|Money available after one pays {{gli|tax|taxes}}; income available for personal consumption and saving.}}

{{term|[[disposition effect]]}}
{{defn|The tendency to sell an asset that has accumulated in value and resist selling an asset that has declined in value.}}

{{term|[[dissaving]]}}
{{defn|Negative {{gli|saving}}, which occurs when spending is greater than {{gli|disposable income}}. This spending may be financed by already accumulated savings, such as money in a {{gli|savings account}}, or it can be {{gli|loan|borrowed}}.}}

{{term|[[Distribution (economics)|distribution]]}}
{{defn|The way total {{gli|output|economic output}}, {{gli|income}}, or {{gli|wealth}} is distributed among individuals or among the {{gli|factors of production}} (such as {{gli|labor}}, {{gli|land}}, and {{gli|capital}}).<ref>[[Paul A. Samuelson]] and [[William Nordhaus|William D. Nordhaus]] (2004). ''[[Economics (textbook)|Economics]]'', 18th ed., [end] Glossary of Terms, "Distribution."</ref> In general theory and the [[national income and product accounts]], each unit of output corresponds to a unit of income.}}

{{term|[[dividends]]}}
{{defn|Payments by a corporation of all or part of its profit to its stockholders (the corporate owners).}}

{{term|[[dividend imputation]]}}
{{defn|A [[corporate tax]] system in which some or all of the tax paid by a company may be attributed, or [[imputation (economics)|imputed]], to the shareholders by way of a [[tax credit]] to reduce the income tax payable on a distribution.}}

{{term|divorce}}
{{defn|The dissolution of a marriage, which in many countries, is considered a contract of property which is shared among the spouses.}}

{{term|[[Dixit–Stiglitz model]]}}
{{defn|A model of [[monopolistic competition]] which formalises consumers' preferences for product variety by using a [[Constant elasticity of substitution|CES]] function.<ref>{{Cite journal | last1 = Dixit | first1 = Avinash K. | last2 = Stiglitz | first2 = Joseph E. |author-link1 = Avinash Dixit | title = Monopolistic competition and optimum product diversity | journal = The American Economic Review | volume = 67 | issue = 3 | pages = 297–308 | publisher = American Economic Association  | date = June 1977 | jstor = 1831401 }}</ref> In the model, variety preference is inherent within the assumption of [[monotone preferences|monotonic preferences]] because a consumer with such preferences prefers to have an average of any two bundles of goods as opposed to extremes.}}

{{term|[[dollar auction]]}}
{{defn|A non-[[zero sum]] [[sequential game]] that illustrates a [[paradox]] brought about by traditional [[rational choice theory]] in which players are compelled to make an ultimately [[irrational]] decision based completely on a sequence of apparently [[rationality|rational]] choices made throughout the game.<ref name="shubik">[[#Shubik|Shubik: 1971]]. p. 109</ref>}}

{{term|[[Domar serfdom model]]}}
{{defn|A mid-to-late 20th century model that develops a hypothesis concerning the causes of agricultural slavery or serfdom in historical societies.}}

{{term|[[Dorfman-Steiner theorem]]}}
{{ghat|Also called '''Dorfman–Steiner condition'''.}}
{{defn|A theorem which specifies the optimal level of advertising that a firm should undertake.}}

{{term|[[double marginalization]]}}
{{defn|A [[Externality|vertical externality]] that occurs when two firms with market power (i.e., not in a situation of [[perfect competition]]), at different vertical levels in the same [[supply chain]], apply a mark-up to their prices.<ref>Gabrielsen, Tommy., Johansen, Bjorn Olav., Shaffer, Greg. (2018). Double Marginalization and the Cost of Shelf Space, Konkurransetilsynet</ref> This is caused by the prospect of facing a steep demand curve slope, prompting the firm to mark-up the price beyond its marginal costs.<ref>Badasyan, Narine., Goeree, Jacob K., Hartmann, Monica., Holt, Charles., Morgan, John., Rosenblat, Tanya., Servatka, Maros., Yandell, Dirk. (2005). ''Vertical Integration of Successive Monopolists: A Classroom Experiment'', National Science Foundation and the University of Virginia Bankard Fund.</ref>}}

{{term|[[Doughnut (economic model)|doughnut economics]]}}
{{defn|A visual framework for [[sustainable development]] – shaped like a [[doughnut]] or [[lifebuoy|lifebelt]] –  combining the concept of [[planetary boundaries]] with the complementary concept of social boundaries.<ref>{{Cite book |last=Raworth |first=Kate |url=https://www-cdn.oxfam.org/s3fs-public/file_attachments/dp-a-safe-and-just-space-for-humanity-130212-en_5.pdf |title=A Safe and Just Space for Humanity: Can We Live within the Doughnut? |date=2012 |series=Oxfam Discussion Papers |author-link=Kate Raworth}}</ref> The name derives from the shape of the diagram, i.e. a disc with a hole in the middle.}}

{{term|[[Downs–Thomson paradox]]}}
{{ghat|Also called the '''Pigou–Knight–Downs paradox'''.}} 
{{defn|A paradox that states that the equilibrium speed of car traffic on a road network is determined by the average door-to-door speed of equivalent journeys taken by [[public transportation|public transport]] or the next best alternative. Although consistent with [[economic theory]], it is a paradox in that it contradicts the common expectation that improvements in the road network will reduce [[traffic congestion]].}}

{{term|[[dual-sector model]]}}
{{ghat|Also called the '''Lewis model'''.}} 
{{defn|A model in [[Development economics|developmental economics]] that explains the growth of a developing economy in terms of a [[labour (economics)|labour]] transition between two sectors, the subsistence or traditional agricultural sector and the capitalist or modern industrial sector.}}

{{term|[[Duggan–Schwartz theorem]]}}
{{defn|A result about [[voting system]]s designed to choose a nonempty set of winners from the preferences of certain individuals, where each individual ranks all candidates in order of preference.}}

{{term|[[duopoly]]}}
{{defn|A situation in which there are exactly two suppliers for a particular good or service.}}

{{term|[[dynamic discrete choice]]}}
{{ghat|Also called '''DDC models''' or'''discrete choice models of dynamic programming'''.}}
{{defn|Models that simulate an agent's choices over discrete options that have future implications. Rather than assuming observed choices are the result of static utility maximization, observed choices in DDC models are assumed to result from an agent's maximization of the [[present value]] of utility, generalizing the [[utility theory]] upon which [[discrete choice]] models are based.<ref>{{cite journal |first1=Michael P. |last1=Keane |authorlink1=Michael Keane (economist) |first2=Kenneth I. |last2=Wolpin |authorlink2=Kenneth Wolpin |title=Empirical applications of discrete choice dynamic programming models |journal=Review of Economic Dynamics |volume=12 |number=1 |pages=1–22 |date=2009 |doi=10.1016/j.red.2008.07.001}}</ref>}}

{{term|[[dynamic stochastic general equilibrium]] (DSGE)}}
{{ghat|Also abbreviated '''DGE''' and '''SDGE'''.}} 
{{defn|A method in {{gli|macroeconomics}} that attempts to explain economic phenomena, such as {{gli|economic growth}} and {{gli|business cycle|business cycles}}, and the effects of {{gli|economic policy}}, through {{gli|econometrics|econometric models}} based on applied [[general equilibrium theory]] and [[microfoundations|microeconomic principles]].}}
{{glossaryend}}

==E==
{{glossary}}
{{term|[[Easterlin paradox]]}}
{{defn|A finding in [[happiness economics]] which states that at a point in time happiness varies directly with income both among and within nations, but over time happiness does not trend upward as income continues to grow: while people on higher incomes are typically happier than their lower-income counterparts at a given point in time, higher incomes don't produce greater happiness over time.<ref name="Easterlin1974">{{cite book|last=Easterlin|year=1974|chapter=Does Economic Growth Improve the Human Lot? Some Empirical Evidence|editor1=Paul A. David|editor2=Melvin W. Reder|title=Nations and Households in Economic Growth: Essays in Honor of Moses Abramovitz|location=New York|publisher=Academic Press, Inc.|chapter-url=http://graphics8.nytimes.com/images/2008/04/16/business/Easterlin1974.pdf}}</ref>}}

{{term|[[ecological model of competition]]}}
{{defn|A reassessment of the nature of competition in the economy which models the economy on [[biology]] (growth, change, death, evolution, [[survival of the fittest]], complex inter-relationships, non-linear relationships) rather than physics.}}

{{term|[[econometrics]]}}
{{defn|The application of [[statistical methods]] to economic data to give [[empirical]] content to economic relationships.<ref name="Pesaran">[[M. Hashem Pesaran]] (1987). "Econometrics," ''[[The New Palgrave: A Dictionary of Economics]]'', v. 2, p. 8 [pp. 8–22]. Reprinted in J. Eatwell ''et al.'', eds. (1990). ''Econometrics: The New Palgrave'', [https://books.google.com/books?id=gBsgr7BPJsoC&dq=econometrics&pg=PA1=false p. 1] [pp. 1–34].  [http://www.dictionaryofeconomics.com/article?id=pde2008_E000007&edition=current&q=Econometrics&topicid=&result_number=2 Abstract] {{webarchive|url=https://web.archive.org/web/20120518001558/http://www.dictionaryofeconomics.com/article?id=pde2008_E000007&edition=current&q=Econometrics&topicid=&result_number=2 |date=18 May 2012 }} ([[The New Palgrave Dictionary of Economics|2008]] revision by J. Geweke, J. Horowitz, and H. P. Pesaran).</ref> More precisely, it is "the quantitative analysis of actual economic phenomena based on the concurrent development of theory and observation, related by appropriate methods of inference".<ref>[[Paul Samuelson|P. A. Samuelson]], [[Tjalling Koopmans|T. C. Koopmans]], and [[Richard Stone|J. R. N. Stone]] (1954). "Report of the Evaluative Committee for ''Econometrica''," ''Econometrica'' 22(2), p. 142. [p [https://www.jstor.org/pss/1907538 pp. 141]–146], as described and cited in Pesaran (1987) above.</ref>}}

{{term|[[economic base analysis]]}}
{{defn|A theory that posits that activities in an area divide into two categories: basic and nonbasic. Basic industries are those exporting from the region and bringing wealth from outside, while nonbasic (or service) industries support basic industries.}}

{{term|[[economic calculation problem|economic calculation problem (ECP)]]}}
{{defn|A criticism of using [[economic planning]] as a substitute for [[Market (economics)|market-based]] allocation of the [[factors of production]].<ref name="Mises">{{cite book|title=Economic calculation in the Socialist Commonwealth|last=Von Mises|first=Ludwig|author-link=Ludwig von Mises|year=1990|publisher=[[Mises Institute]]|url=https://mises.org/sites/default/files/Economic%20Calculation%20in%20the%20Socialist%20Commonwealth_Vol_2_3.pdf}}</ref><ref>Hayek, Friedrich (1935). "The Nature and History of the Problem"; "The Present State of the Debate". ''Collectivist Economic Planning''. pp. 1–40, 201–243.</ref> It is argued that economy planning necessarily leads to an irrational and inefficient [[allocation of resources]].}}

{{term|[[economic cost]]}}
{{defn|The combination of  losses of any goods that have a value attached to them by any one individual.<ref>{{Cite journal|last=Phillips|first=Ulrich B.|date=1905|title=The Economic Cost of Slaveholding in the Cotton Belt|journal=Political Science Quarterly|volume=20|issue=2|pages=257–275|doi=10.2307/2140400|issn=0032-3195|jstor=2140400|hdl=2027/hvd.32044082042185|hdl-access=free}}</ref><ref name=mbw>{{Cite web |title=What is economic cost? Definition, comparisons, and examples |work=Market Business News |access-date=2019-07-16 |url=https://marketbusinessnews.com/financial-glossary/economic-cost/}}</ref> Economic cost is used as means to compare the prudence of one course of action with that of another.}}

{{term|[[economic democracy]]}}
{{ghat|Also called a '''democratic economy'''.}}
{{defn|A [[Socioeconomics|socioeconomic]] philosophy that proposes to shift ownership<ref>{{cite web |url=https://bcdi.nyc/economic-democracy#:~:text=Economic%20democracy%20is%20a%20system,cooperation%2C%20democracy%2C%20and%20sustainability. |title=What is Economic Democracy? |website=bcdi |access-date=31 May 2023}}</ref><ref>{{cite web |url=https://thenextsystem.org/node/204 |title=Economic Democracy: An Ethically Desirable Socialism That Is Economically Viable|last=Schweickart |first=David |website= The Next System |date=March 2016 |access-date=31 May 2023}}</ref><ref>{{cite web |url=https://www.opendemocracy.net/en/opendemocracyuk/economic-democracy-in-21st-century/ |title=Economic democracy in the 21st Century |last=Malleson |first=Tom |date=2014 |website=Open Democracy |access-date=28 May 2023}}</ref> and decision-making power from [[Shareholder|corporate shareholders]] and [[Management|corporate managers]] (such as a board of directors) to a larger group of [[stakeholder theory|public stakeholders]] that includes workers, consumers, suppliers, communities and the broader public.}}

{{term|[[economic development]]}}
{{defn|Broad improvement in the economic well-being or [[quality of life]] of a nation, region, or community, often but not necessarily as a consequence of {{gli|economic growth}}.}}

{{term|[[economic efficiency]]}}
{{defn|A variety of concepts which denote some situation where desired outputs (such as [[utility]]) are maximized given available inputs. This can include [[allocative efficiency]], [[distributive efficiency]], [[dynamic efficiency]], [[financial market efficiency]], [[Kaldor–Hicks efficiency]], [[operational efficiency]], [[Pareto efficiency]], and [[productive efficiency]].}}

{{term|[[economic equilibrium]]}}
{{defn|A situation in which economic forces such as {{gli|supply and demand}} are balanced and in which, in the absence of external influences, the values of economic variables do not change. For example, in the standard textbook model of {{gli|perfect competition}}, equilibrium occurs at the point at which quantity demanded and quantity supplied are equal.<ref>{{cite book |author-link=Hal Varian |first=Hal R. |last=Varian |title=Microeconomic Analysis |edition=3rd |publisher=Norton |location=New York |year=1992 |isbn=0-393-95735-7 |url=https://archive.org/details/microeconomicana00vari_0 }}</ref> '''Market equilibrium''' in this case is a condition in which a market price is established through competition such that the amount of goods or services sought by [[Law of supply and demand|buyers]] is equal to the amount of goods or services produced by [[Law of supply and demand|sellers]]. This price is often called the '''competitive price''' or {{gli|market clearing}} price and will tend not to change unless demand or supply changes, and the quantity is called the "competitive quantity" or market clearing quantity. However, the concept of equilibrium in economics also applies to {{gli|imperfect competition|imperfectly competitive}} markets, where it takes the form of a {{gli|Nash equilibrium}}.}}

{{term|[[economic growth]]}}
{{defn|An increase in the inflation-adjusted {{gli|market value}} of the goods and services produced by an {{gli|economy}} over time. It is conventionally measured as the percent rate of increase in real {{gli|gross domestic product}}, or real GDP.<ref>[http://www.statista.com/statistics/197039/growth-of-the-global-gross-domestic-product-gdp/ Statistics on the Growth of the Global Gross Domestic Product (GDP) from 2003 to 2013], IMF, October 2012.</ref>}}

{{term|[[economic indicator]]}}
{{defn|Any measurable unit of the economy which helps economists assess the past or make predictions about the future, such as {{gli|unemployment rate}} and {{gli|gross domestic product}}.}}

{{term|[[economic interdependence]]}}
{{defn|The existence of necessary relationships between different sectors of the economy and how the decisions and actions of one will impact the others.}}

{{term|[[economic methodology]]}}
{{defn|The study of methods, especially the scientific method, in relation to {{gli|economics}}, including principles underlying economic reasoning.}}

{{term|[[economic model]]}}
{{defn|A theoretical construct representing an economic process by a set of variables and a set of logical and/or quantitative relationships between them. Economic models are usually simplified, often [[Mathematical model|mathematical]], frameworks designed to illustrate complex processes. Frequently, economic models posit [[Coefficient of regression|structural parameters]].<ref>Moffatt, Mike. (2008) [[About.com]] ''[http://economics.about.com/od/economicsglossary/g/structuralp.htm Structural Parameters] {{Webarchive|url=https://web.archive.org/web/20160107121857/http://economics.about.com/od/economicsglossary/g/structuralp.htm |date=2016-01-07 }}'' Economics Glossary; Terms Beginning with S. Accessed June 19, 2008.</ref> A model may have various [[exogenous variable]]s, and those variables may change to create various responses by economic variables. Methodological uses of models include investigation, theorizing, and fitting theories to the world.<ref>[[Mary S. Morgan]], 2008 "models," ''[[The New Palgrave Dictionary of Economics]]'', 2nd Edition, [http://www.dictionaryofeconomics.com/article?id=pde2008_M000391 Abstract].<br/>&nbsp;&nbsp; Vivian Walsh 1987. "models and theory," ''The New Palgrave: A Dictionary of Economics'', v. 3, pp. 482–83.</ref>}}

{{term|[[economic rent]]}}
{{ghat|Also called '''economic profits'''.}}
{{defn|Any monies collected by a firm above and beyond what is required to keep an entrepreneur owner interested in continuing in business.}}

{{term|[[economic sector]]}}
{{defn|A category of economic activity.}}

{{term|[[economic security]]}}
{{ghat|Also called '''financial security'''.}}
{{defn|The condition of having stable income or other resources to support a [[standard of living]] now and in the foreseeable future. It includes probable continued [[solvency]], predictability of the future [[cash flow]] of a person or other [[Economic Entity]], such as a country, and employment security or [[job security]].}}

{{term|[[economic shortage]]}}
{{ghat|Also called '''excess demand'''.}}
{{defn|A situation in which the {{gli|demand}} for a particular {{gli|good}} or {{gli|service}} exceeds its {{gli|supply}} within a particular {{gli|market}}. A shortage is the opposite of a {{gli|economic surplus|surplus}}.}}

{{term|[[economic surplus]]}}
{{ghat|Also called '''excess supply'''.}}
{{defn|A situation in which the {{gli|supply}} of a {{gli|good}} or {{gli|service}} exceeds its {{gli|demand}} within a particular {{gli|market}}, often as a result of the current {{gli|price}} being below the {{gli|economic equilibrium}}.}}

{{term|[[economic system]]}}
{{ghat|Also called an '''economic order'''.<ref>Daniel J. Cantor, Juliet B. Schor, ''Tunnel Vision: Labor, the World Economy, and Central America'', South End Press, 1987, p. 21: "By economic system or economic order, we mean the principles, laws, institutions, and understandings business is conducted."</ref>}}
{{defn|A system of {{gli|production}}, {{gli|resource allocation}}, and {{gli|distribution}} of {{gli|goods and services}} within a society or a given geographic area. It includes the combination of the various institutions, agencies, entities, decision-making processes, and patterns of {{gli|consumer|consumption}} that comprise the economic structure of a given community. As such, an economic system is a type of [[social system]]. The {{gli|mode of production}} is a related concept.<ref>{{cite book|last=Gregory and Stuart|first=Paul and Robert|title=The Global Economy and its Economic Systems|publisher=South-Western College Pub|year=2013|isbn=978-1285055350|pages=30|quote=Economic system – A set of institutions for decision making and for the implementation of decisions concerning production, income, and consumption within a given geographic area.}}</ref> All economic systems have three basic questions to ask: what to produce, how to produce it, and in what quantities and who receives the output of production.}}

{{term|[[economics]]}}
{{defn|The [[social science]] that studies the {{gli|production}}, {{gli|distribution}}, and {{gli|consumption}} of {{gli|goods and services}} within {{gli|economy|economies}}.<ref>{{cite book | last1 = Krugman | first1 = Paul | author-link = Paul Krugman | last2 = Wells | first2= Robin | title = Economics | publisher =Worth Publishers | edition =3rd | date =2012 | page = 2 | isbn =978-1464128738 }}</ref>}}

{{term|[[economies of agglomeration]]}}
{{ghat|Also called '''agglomeration effects'''.}}
{{defn|The major subfield of [[urban economics]] which explains how urban agglomeration occurs in locations where cost savings can naturally arise.<ref name=":0b">{{Cite journal |last1=Ellison |first1=Glenn |last2=Glaeser |first2=Edward L. |date=May 1999 |title=The Geographic Concentration of Industry: Does Natural Advantage Explain Agglomeration? |url=https://www.jstor.org/stable/117127 |journal=The American Economic Review |volume=89 |issue=2 |pages=311–316 |doi=10.1257/aer.89.2.311 |jstor=117127 }}</ref> This term is most often discussed in terms of economic firm productivity. However, agglomeration effects also explain some social phenomenon, such as large proportions of the population being clustered in cities and major urban centres.<ref name=":1">{{Cite journal |last=Puga |first=Diego |date=3 February 2010 |title=The magnitude and causes of agglomeration economies |url=https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1467-9787.2009.00657.x |journal=Journal of Regional Science |volume=50 |issue=1 |pages=203–219 |doi=10.1111/j.1467-9787.2009.00657.x |bibcode=2010JRegS..50..203P |s2cid=17848032 |via=Wiley Online Library}}</ref>}}

{{term|[[economies of scale]]}}
{{defn|The cost advantages that enterprises obtain as a result of the increased efficiency offered by a certain scale of operation (typically measured by amount of {{gli|output}} produced), with cost per unit of output decreasing with increasing scale. At the basis of economies of scale there may be technical, statistical, organizational, or related factors to the degree of market control.}}

{{term|[[economies of scope]]}}
{{defn|The cost advantages that enterprises obtain as a result of the increased efficiency offered by variety rather than by volume, with cost per unit of {{gli|output}} decreasing with increasing variety.<ref name=hbr>{{cite news|author1=Joel D. Goldhar|author2=Mariann Jelinek|title=Plan for Economies of Scope|url=https://hbr.org/1983/11/plan-for-economies-of-scope|work=Harvard Business Review|date=November 1983}}</ref> In economics, "scope" is synonymous with broadening production through diversified products. For example, a gas station that sells gasoline can also sell soda, milk, baked goods, etc. through their customer service representatives, which may make the sale of gasoline more efficient.<ref name=econ>{{cite news|title=Economies of scale and scope|url=http://www.economist.com/node/12446567|newspaper=The Economist|date=October 20, 2008}}</ref>}}

{{term|[[economist]]}}
{{defn|A practitioner in the discipline of {{gli|economics}}.}}

{{term|[[economy]]}}
{{defn|An area of the {{gli|production}}, {{gli|distribution}}, {{gli|trade}}, and {{gli|consumption}} of {{gli|good|goods}} and {{gli|service|services}} by different agents. In its broadest sense, an economy may be defined as "a social domain that emphasizes the practices, discourses, and material expressions associated with the production, use, and management of resources".<ref>{{Cite book | last1= James | first1= Paul | author-link= Paul James (academic) | last2= with Magee | first2= Liam | last3= Scerri | first3= Andy | last4= Steger | first4= Manfred B. | title= Urban Sustainability in Theory and Practice: Circles of Sustainability | url= https://www.academia.edu/9294719 | year= 2015 | publisher= Routledge | location= London | page=53| isbn= 9781315765747 }}</ref>}}

{{term|[[Edgeworth box]]}}
{{ghat|Also called an '''Edgeworth-Bowley box'''.}}
{{defn|A graphical representation of a market with just two commodities, ''X'' and ''Y'', and two consumers. The dimensions of the box are the total quantities Ω<sub>''x''</sub> and Ω<sub>''y''</sub> of the two goods.}}

{{term|[[Edgeworth paradox]]}}
{{defn|A situation in which two players cannot reach a state of equilibrium with pure strategies, i.e. each charging a stable price. It was proposed to solve the [[Bertrand paradox (economics)|Bertrand paradox]].}}

{{term|[[Edgeworth's limit theorem]]}}
{{defn|A theorem stating that the [[Core (game theory)|core]] of an economy shrinks to the set of [[Walrasian equilibria]] as the number of [[Agent (economics)|agents]] increases to infinity. That is, among all possible outcomes which may result from [[free market]] exchange or [[barter]] between groups of people, while the precise location of the final settlement (the ultimate division of goods) between the parties is not uniquely determined, as the number of traders increases, the set of all possible final settlements converges to the set of Walrasian equilibria.}}

{{term|[[effective demand|effective demand {(ED)]]}}
{{defn|The [[demand]] for a product or service which occurs when purchasers are constrained in a different market.}}

{{term|[[efficiency dividend]]}}
{{defn|An annual reduction in resources available to an organization.<ref>{{cite web|title=efficiency dividend|url=http://www.businessdictionary.com/definition/efficiency-dividend.html|website=www.businessdictionary.com|publisher=WebFinance Inc|accessdate=5 January 2015|archive-date=30 December 2014|archive-url=https://web.archive.org/web/20141230162748/http://www.businessdictionary.com/definition/efficiency-dividend.html|url-status=dead}}</ref>  It is usually applied as a percentage of operational (running) costs.}}

{{term|[[efficiency wage]]}}
{{ghat|Also called '''efficiency earnings'''.}}
{{defn|Originally referred to the wage per efficiency unit of labor.<ref name="EOL">{{Cite book |last=Marshall |first=Alfred |title=Principles of Economics |publisher=Macmillan and Co., Ltd. |year=1920 |edition=8th |location=London |chapter=Earnings of Labour Book VI Chapter III |doi=10.1057/9781137375261_45}}</ref> Marshallian efficiency wages are those calculated with efficiency or ability exerted being the unit of measure rather than time.<ref name="EOL" /> Today, efficiency wage 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|market-clearing]] level.}}

{{term|[[efficient envy-free division]]}}
{{ghat|Also called a '''PEEF division'''.}}
{{defn|A [[fair division|division of resources]] among agents that is both [[Pareto efficient]] (PE) and [[envy-free]] (EF).}}

{{term|[[efficient market hypothesis|efficient market hypothesis (EMH)]]}}
{{ghat|Also called '''efficient market theory (EMT)'''.}}
{{defn|A hypothesis that states that [[asset]] prices reflect all available information. A direct implication is that it is impossible to "beat the market" consistently on a risk-adjusted basis since market prices should only react to new information.}}

{{term|[[price elasticity of demand|elastic demand]]}}
{{defn|{{gli|demand|Demand}} that is sensitive to changes in {{gli|price}}, such that changes in price have a relatively large effect on the quantity of the good demanded. Contrast ''{{gli|inelastic demand}}''.}}

{{term|[[Elasticity (economics)|elasticity]]}}
{{defn|The measurement of the proportional change of an economic variable in response to a change in another. Colloquially, elasticity is often interpreted as how easy it is for a supplier or consumer to change their behavior and substitute another good, the strength of an incentive over choices per the relative {{gli|opportunity cost}}.}}

{{term|[[elasticity of complementarity]]}}
{{defn|Measures the sensitivity of relative factor prices to a change in relative inputs.}}

{{term|[[elasticity of intertemporal substitution|elasticity of intertemporal substitution (EIS)]]}}
{{ghat|Also called '''intertemporal elasticity of substitution (IES)'''.}}
{{defn|Measures the sensitivity of the [[Economic growth|growth rate]] of [[consumption (economics)|consumption]] to the [[real interest rate]].<ref>[https://www.jstor.org/pss/1833112 Robert Hall, JPE]</ref>}}

{{term|[[elasticity of substitution]]}}
{{defn|Measures the sensitivity of the relative use of two goods to a change in their relative prices.}}

{{term|[[electronic funds transfer|electronic funds transfer (EFT)]]}}
{{defn|The digital transfer of money from one bank account to another, usually through computer-based systems, without the involvement of bank staff.}}

{{term|[[Elliott wave principle]]}}
{{ghat|Also called '''Elliott wave theory'''.}}
{{defn|A form of [[technical analysis]] that [[Trader (finance)|financial traders]] use to analyze financial [[Stock market cycles|market cycles]] and forecast [[market trend]]s by identifying extremes in investor psychology and price levels, such as highs and lows, by looking for patterns in prices.
}}

{{term|[[Ellsberg paradox]]}}
{{ghat|Also called '''Ellsberg's paradox'''.}}
{{defn|A [[paradox]] in which people's decisions are inconsistent with [[subjective expected utility]] theory. It is generally taken to be evidence of [[ambiguity aversion]], in which a person tends to prefer choices with quantifiable risks over those with unknown, incalculable risks.}}

{{term|[[employee benefits]]}}
{{defn|Any forms of compensation to an employee in addition to wages or salary for example, parental leave and vacation pay.}}

{{term|[[endogenous growth theory]]}}
{{defn|A theory that economic growth is primarily the result of [[Endogeneity (econometrics)|endogenous]] and not external forces.<ref>{{cite journal |journal = [[The Journal of Economic Perspectives]] |volume= 8 |issue= 1 |year= 1994 |first= P. M. |last= Romer |title= The Origins of Endogenous Growth |author-link= Paul Romer |pages =3–22 |jstor=2138148 |doi=10.1257/jep.8.1.3|doi-access=  }}</ref> Endogenous growth theory holds that investment in [[human capital]], [[innovation]], and knowledge are significant contributors to economic growth. The theory also focuses on [[positive externalities]] and [[spillover effects]] of a knowledge-based economy which will lead to economic development.}}

{{term|[[Exogenous and endogenous variables|endogenous variable]]}}
{{defn|A variable whose measure is determined by the model.}}

{{term|[[energy modeling]]}}
{{defn|The process of building [[computer model]]s of [[energy system]]s in order to analyze them.}}

{{term|[[Engel curve]]}}
{{defn|Describes how household expenditure on a particular good or service varies with household income.<ref>{{cite journal |last1=Chai |first1=A. |last2=Moneta |first2=A. |year=2010 |title=Retrospectives: Engel Curves |journal=[[Journal of Economic Perspectives]] |volume=24 |issue=1 |pages=225–240 |doi= 10.1257/jep.24.1.225|hdl=10072/34021 |url=https://www.iris.sssup.it/bitstream/11382/347390/1/9_ChaiMoneta10.pdf |hdl-access=free }}</ref><ref name="bare_url">{{cite book | chapter-url = https://www2.bc.edu/arthur-lewbel/palengel.pdf | author = Lewbel, A | date = 2007 | chapter = Engel Curves | title = The New Palgrave Dictionary of Economics}}</ref>}}

{{term|[[engineering economics]]}}
{{defn|Previously known as engineering economy, is a subset of economics concerned with the use and "...application of economic principles"<ref name="Dharmaraj2009">Dharmaraj, E.. Engineering Economics. Mumbai, IN: Himalaya Publishing House, 2009. ProQuest ebrary. Web. 9 November 2016.</ref> in the analysis of engineering decisions.<ref name="Morris1960">Morris, W. Thomas. (1960). Engineering economy: the analysis of management decisions. Homewood, Ill.: R. D. Irwin.</ref>}}

{{term|[[entrepreneurship]]}}
{{defn|The efforts by a person, known as an '''entrepreneur''', in organizing resources for the creation of something new or taking risks to create new innovations and production.}}

{{term|[[envelope theorem]]}}
{{defn|A major result about the differentiability properties of the [[value function]] of a parameterized optimization problem.<ref>{{cite journal |first=Kim C. |last=Border |year=2019 |title=Miscellaneous Notes on Optimization Theory and Related Topics |journal=Lecture Notes |publisher=California Institute of Technology |page=154 |url=https://paperzz.com/doc/7000652/miscellaneous-notes-on-optimization-theory-and-related-to...}}</ref> As we change parameters of the objective, the envelope theorem shows that, in a certain sense, changes in the decision variable(s) of the objective do not contribute to the change in the objective function.}}

{{term|[[environmental economics]]}}
{{defn|A sub-field of economics concerned particularly with environmental issues.}}

{{term|[[equal opportunity]]}}
{{defn|A state of fairness in which job applicants are treated similarly, unhampered by artificial barriers or prejudices or preferences, except when particular distinctions can be explicitly justified.<ref>Paul de Vries (September 12, 2011), "equal opportunity", Blackwell Reference, retrieved September 12, 2011</ref>}}

{{term|[[wikt:Equilibrium|equilibrium]]}}
{{defn|The point at which quantity demanded and quantity supplied are equal and both consumer and producer are satisfied.}}

{{term|[[equilibrium price]]}}
{{defn|The {{gli|market price}} at which both the supplier and consumer will trade and both are satisfied.}}

{{term|[[Equity (economics)|equity]]}}
{{ghat|Also called '''economic equality'''.}}
{{defn|The concept or idea of fairness in economics, particularly in regard to {{gli|taxation}} or {{gli|welfare economics}}. More specifically, it may refer to [[Equal opportunity|equal life chances]] regardless of identity, to provide all citizens with a basic and equal minimum of income, goods, and services or to increase funds and commitment for redistribution.<ref name=ODI2>Kate Bird 2009. [http://blogs.odi.org.uk/blogs/main/archive/2009/11/24/building_fair_future.aspx Building a fair future: why equity matters] {{Webarchive|url=https://web.archive.org/web/20110721182208/http://blogs.odi.org.uk/blogs/main/archive/2009/11/24/building_fair_future.aspx |date=2011-07-21 }}. London: [[Overseas Development Institute]]</ref>}}

{{term|[[equity home bias puzzle]]}}
{{defn|The fact that individuals and institutions in most countries hold only modest amounts of foreign [[Equity (finance)|equity]], and tend to strongly favor company stock from their home nation. This finding is regarded as puzzling, since ample evidence shows [[Portfolio (finance)|equity portfolios]] obtain substantial benefits from [[Diversification (finance)|diversification]] into global stocks.}}

{{term|[[equity premium puzzle]]}}
{{defn|The inability of an important class of [[economic model]]s to explain the average equity risk premium provided by a diversified portfolio of [[equities]] over that of [[government bond]]s, which has been observed for more than 100 years.}}

{{term|[[ergodicity economics]]}}
{{defn|A research programme aimed at reworking the theoretical foundations of [[economics]] around the concept of [[ergodicity]].<ref>{{cite web |title=Ergodicity Economics: About – London Mathematical Laboratory |url=http://lml.org.uk/research/economics/ |access-date=2 October 2024}}</ref> The programme's main goal is to understand how traditional economic theory, framed in terms of the ''[[expected value|expectation values]]'', changes when replacing expectation value with time averages.}}

{{term|[[Eurosclerosis]]}}
{{defn|A pattern of high unemployment and slow job creation in Europe during the 1970s and 1980s that may have resulted from government over-regulation and overly generous social benefits policies.<ref>[http://www.investopedia.com/terms/e/eurosclerosis.asp Investopedia: Eurosclerosis Definition]</ref>}}

{{term|[[excess burden of taxation]]}}
{{defn|The economic loss that society suffers as a result of the distortions caused by taxes or subsidies.}}

{{term|[[excess supply]]}}
{{ghat|Also called '''economic surplus'''.<ref>{{cite web|url=http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=excess+supply|title=AmosWEB is Economics: Encyclonomic WEB*pedia|website=www.amosweb.com}}</ref>}}
{{defn|A situation in which the quantity of a good or service supplied is more than the quantity demanded,<ref>{{cite book| last1 = O'Sullivan| first1 = Arthur| author-link = Arthur O'Sullivan (economist)| first2 = Steven M. | last2 = Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2022| location = Paramus, New Jersey| pages = 128| isbn = 978-0-13-063085-8}}</ref> and the price is above the {{gli|economic equilibrium|equilibrium}} level determined by {{gli|supply and demand}}; that is, the quantity of the product that producers wish to sell exceeds the quantity that potential buyers are willing to buy at the prevailing price. It is the opposite of an {{gli|shortage|economic shortage}}.}}

{{term|[[exchange rate]]}}
{{defn|The rate at which one {{gli|currency}} is exchanged for another. It is also commonly regarded as the value of one country's currency relative to another currency.<ref>{{cite book| last = O'Sullivan| first = Arthur| author-link = <!-- Arthur O'Sullivan -->|author2=Steven M. Sheffrin| title = Economics| publisher = Savvas Learning Company| year = 2022| location = Paramus, New Jersey| pages = 458| url = https://www.savvas.com/index.cfm?locator=PS3jRm| isbn = 978-0-13-063085-8}}</ref>}}

{{term|[[exchange rate regime]]}}
{{defn|Any method a [[monetary authority]] of a country or [[currency union]] may use to manage the [[currency]] in relation to other currencies and the [[foreign exchange market]].}}

{{term|[[exchange-traded fund]]}}
{{defn|A group of securities that are traded in an exchange market.}}

{{term|[[excludability]]}}
{{defn|The degree to which a [[Goods|good]], [[Service (economics)|service]], or [[resource]] can be limited to only paying customers, or conversely, the degree to which a supplier, producer, or other managing body (e.g. a government) can prevent [[Consumption (economics)|consumption]] of a good.}}

{{term|[[exogenous growth model]]}}
{{defn|See ''[[Glossary of economics#solow%E2%80%93swan model|Solow-Swan model]]''.}}

{{term|[[Exogenous and endogenous variables|exogenous variable]]}}
{{defn|A variable whose measure is determined outside the model and is imposed on the model.}}

{{term|[[expected utility hypothesis]]}}
{{defn|A foundational assumption in [[mathematical economics]] concerning [[decision theory|decision making]] under [[uncertainty]]. It postulates that [[rational agent]]s maximize utility, meaning the subjective desirability of their actions, choosing between risky prospects by comparing expected utility values (i.e. the weighted sum of adding the respective utility values of payoffs multiplied by their probabilities).}}

{{term|[[expeditionary economics]]}}
{{defn|An emerging field of economic enquiry that focuses on the rebuilding and reconstructing of economies in post-conflict nations and providing support to disaster-struck nations. It focuses on the need for good [[economic planning]] on the part of developed nations to help prevent the creation of failed states. It also emphasizes the need for the structuring on new firms to rebuild national economies.<ref name="Expeditionary Economics: A New Model for Post-Conflict Countries">{{cite web |url=http://www.milkeninstitute.org/events/gcprogram.taf?function=detail&EvID=2305&eventid=gc10 |title=Expeditionary Economics: A New Model for Post-Conflict Countries |work=Milken Institute |access-date=March 29, 2013 |archive-url=https://web.archive.org/web/20130307193918/http://www.milkeninstitute.org/events/gcprogram.taf?function=detail&EvID=2305&eventid=GC10 |archive-date=March 7, 2013 |url-status=dead }}</ref>}}

{{term|[[expenditure function]]}}
{{defn|Any function which gives the minimum amount of money an individual needs to spend to achieve some level of [[utility]], given a [[utility function]] and the prices of the available goods.}}

{{term|[[experimental economics]]}}
{{defn|The application of [[Experiment|experimental methods]]<ref>Including [[statistical]], [[econometric]], and [[computational economics|computational]]. On the latter see [[Alvin E. Roth]], 2002. "The Economist as Engineer: Game Theory, Experimentation, and Computation as Tools for Design Economics," ''Econometrica'', 70(4), pp. [http://kuznets.fas.harvard.edu/~aroth/papers/engineer.pdf 1341–1378] {{webarchive|url=https://web.archive.org/web/20040414102216/http://kuznets.fas.harvard.edu/~aroth/papers/engineer.pdf |date=2004-04-14 }}.</ref> to study economic questions.}}

{{term|[[externality]]}}
{{defn|A cost or benefit that falls not on the person(s) directly involved in an activity, but on others. Externalities can be positive or negative.}}

{{term|[[extreme poverty]]}}
{{ghat|Also called '''deep poverty''', '''abject poverty''', '''absolute poverty''', '''destitution''', or '''penury'''.}}
{{defn|The most severe type of [[poverty]], defined by the [[United Nations]] as "a condition characterized by severe deprivation of basic human needs, including food, safe [[drinking water]], sanitation facilities, health, shelter, [[education]], and [[information]]. It depends not only on income but also on access to services".<ref>United Nations. [https://web.archive.org/web/2019*/https://www.un.org/documents/ga/conf166/aconf166-9.htm "Report of the World Summit for Social Development"], 6–12 March 1995. (archived from [https://www.un.org/documents/ga/conf166/aconf166-9.htm the original] on 4 July 2019)</ref>}}
{{glossaryend}}

==F==
{{glossary}}
{{term|[[factors of production]]}}
{{defn|Inputs (resources) used to create goods and services, including land, labor, {{gli|capital}}, and entrepreneurship.}}

{{term|[[factor price]]}}
{{defn|}}

{{term|[[factor price equalization]]}}
{{defn|}}

{{term|[[factor income]]}}
{{defn|}}

{{term|[[fair trade]]}}
{{defn|}}

{{term|[[fair trade debate]]}}
{{defn|}}

{{term|[[fascism]]}}
{{defn|}}

{{term|[[Faustmann's formula]]}}
{{defn|}}

{{term|federal funds rate target}}
{{defn|}}

{{anchor|Federal Open Market Committee}}{{term|[[Federal Open Market Committee]] (FOMC)}}
{{defn|The twelve-member committee of the United States {{gli|Federal Reserve System|Federal Reserve}} that meets several times a year to decide the course of action that should be taken to control the {{gli|money supply}} of the United States.}}

{{term|[[Federal Reserve System]]}}
{{ghat|Often simply the '''Federal Reserve''' or '''the Fed'''.}}
{{defn|The {{gli|central bank}} of the United States, created by Congress in 1913 and charged with the duty of regulating the {{gli|money supply}} and monitoring its member {{gli|bank|banks}}.}}

{{term|[[Fed model]]}}
{{defn|}}

{{term|[[Fei–Ranis model of economic growth]]}}
{{defn|}}

{{term|[[Feldman–Mahalanobis model]]}}
{{defn|}}

{{term|[[Feldstein–Horioka puzzle]]}}
{{defn|}}

{{term|[[feudalism]]}}
{{defn|}}

{{term|[[fiat money]]}}
{{defn|}}

{{term|[[final good]]}}
{{defn|}}

{{term|finance}}
{{defn|The study of {{gli|money}} and how it is used. Specifically, it deals with the questions of how an individual, company, or government acquires the money needed—called {{gli|capital}} in the company context—and how they then spend or invest that money.<ref name="freedictionary">[https://financial-dictionary.thefreedictionary.com/finance "Finance"] Farlex Financial Dictionary. 2012</ref>
<!-- Participants in the [[market (economics)|market]] aim to price assets based on their risk level, fundamental value, and their expected [[rate of return]]. --> Finance is often split into three areas: [[personal finance]], [[corporate finance]], and [[public finance]]. At the same time, ''finance'' is about the overall "system", i.e. the [[financial market]]s that allow the flow of money, via investments and other {{gli|financial instrument|financial instruments}}, between and within these areas; this "flow" is facilitated by the {{gli|financial services}} sector. A major focus within finance is thus [[investment management]]—called [[money management]] for individuals, and [[asset management]] for institutions—and finance then includes the associated activities of [[securities trading]], [[investment bank]]ing, [[financial engineering]], and [[risk management]].}}

{{term|[[financial deepening]]}}
{{defn|}}

{{term|[[financial economics]]}}
{{defn|}}

{{term|[[financial institution]]}}
{{defn|Any firm, such as a {{gli|bank}}, that is in the business of holding money for those who save and lending money to those who need {{gli|loan|loans}}.}}

{{term|financial markets}}
{{defn|Markets where people trade the property rights to assets (like real estate or stocks) or where savers lend money to borrowers.}}

{{term|[[financial planning]]}}
{{defn|A series of steps used by a person or a firm to achieve a financial goal.}}

{{term|[[financial risk]]}}
{{defn|The risk assumed by a saver or investor on future outcomes that involve financial losses and gains.}}

{{term|[[financial transaction]]}}
{{defn|An agreement or communication carried out between a {{gli|buyer}} and a {{gli|seller}} to {{gli|trade|exchange}} an {{gli|asset}} for {{gli|payment}}.}}

{{term|[[financial transaction tax]]}}
{{defn|}}

{{term|[[fiscal conservatism]]}}
{{defn|}}

{{term|[[fiscal multiplier]]}}
{{defn|The ratio of change in national income arising from a change in government spending.}}

{{term|[[fiscal policy]]}}
{{defn|A government's policy on taxes and spending.}}

{{term|[[fiscal theory of the price level]]}}
{{defn|}}

{{term|[[Fisher equation]]}}
{{defn|}}

{{term|[[Fisher separation theorem]]}}
{{defn|}}

{{term|[[fixed cost]]s}}
{{defn|Costs that have to be paid even if a firm is not producing anything.}}

{{term|[[foreign exchange market]]}}
{{ghat|Also called the '''currency market''' or abbreviated '''Forex''' or '''FX'''.}}
{{defn|A global [[decentralization|decentralized]] or [[Over-the-counter (finance)|over-the-counter]] market for the trading of {{gli|currency|currencies}}. This market determines the {{gli|exchange rate|foreign exchange rate}}. It includes all aspects of buying, selling and exchanging currencies at current or determined prices. In terms of [[Volume (finance)|trading volume]], it is by far the largest market in the world, followed by the [[Bond market|credit market]].<ref>[[Neil Record|Record, Neil]], ''Currency Overlay'' (Wiley Finance Series)</ref>}}

{{term|[[fractional-reserve banking]]}}
{{defn|}}

{{term|[[Framing (social sciences)#In psychology and economics|framing effect]]}}
{{defn|}}

{{term|[[free good]]}}
{{defn|}}

{{term|[[free market]]}}
{{defn|An {{gli|economic system}} in which the {{gli|price|prices}} for [[goods and services]] are self-regulated by the {{gli|open market}} and by {{gli|consumer|consumers}}. In a free market, the laws and forces of [[supply and demand]] are free from any intervention by a [[Forms of government|government]] or other authority and from all forms of economic privilege, {{gli|monopoly|monopolies}}, and {{gli|artificial scarcity|artificial scarcities}}.<ref>Popper, Karl (1994). The Open Society and Its Enemies. Routledge Classics. {{ISBN|978-0-415-61021-6}}.</ref> Proponents of the concept of the free market contrast it with a [[regulated market]] in which a government intervenes in supply and demand through various methods such as {{gli|tariff|tariffs}} used to restrict trade and to protect the local economy. In an idealized [[free-market economy]], prices for goods and services are set freely by the forces of supply and demand and are allowed to reach their point of {{gli|economic equilibrium|equilibrium}} without intervention by government policy.}}

{{term|[[free-rider problem]]}}
{{defn|}}

{{term|[[free trade]]}}
{{defn|{{gli|trade|Trade}} between countries that occurs with few or no trade barriers.}}

{{term|Freiburg school}}
{{defn|}}

{{term|[[Saltwater and freshwater economics|freshwater economics]]}}
{{defn|}}

{{term|[[frictional unemployment]]}}
{{defn|Unemployment that is a result of workers moving from one job to another, as opposed to {{gli|structural unemployment}}.}}

{{term|[[Friedman rule]]}}
{{defn|}}

{{term|[[Friedman's k-percent rule]]}}
{{defn|}}

{{term|[[Frisch–Waugh–Lovell theorem]]}}
{{defn|}}

{{term|[[full employment]]}}
{{defn|}}

{{term|full employment output (Y*)}}
{{defn|How much output is produced in the economy when {{gli|full employment}} exists in the labor market.}}

{{term|[[full-reserve banking]]}}
{{defn|}}

{{term|[[functions of money]]}}
{{defn|The four classic functions or uses of {{gli|money}} as summarized by [[William Stanley Jevons]] in 1875: a {{gli|medium of exchange}}, a common measure of value (or {{gli|unit of account}}), a standard of value (or {{gli|standard of deferred payment}}), and a {{gli|store of value}}. This analysis later became a fundamental concept of {{gli|macroeconomics}}. Most modern textbooks now list only three functions, that of medium of exchange, unit of account, and store of value, not considering a standard of deferred payment as a distinguished function, but rather subsuming it in the others.}}

{{term|[[Fundamental theorem of asset pricing|fundamental theorems of asset pricing]]}}
{{defn|}}

{{term|[[fundamental theorems of welfare economics]]}}
{{defn|}}

{{term|[[future value]]}}
{{defn|}}
{{glossaryend}}

==G==
{{glossary}}
{{term|[[gains from trade]]}}
{{defn|}}

{{term|[[Gale–Shapley algorithm]]}}
{{defn|}}

{{term|[[Galor–Zeira model]]}}
{{defn|}}

{{term|[[Gandhian economics]]}}
{{defn|}}

{{term|[[GDP deflator]]}}
{{defn|}}

{{term|[[general equilibrium theory]]}}
{{defn|}}

{{term|[[Georgism]]}}
{{defn|}}

{{term|[[Gerschenkron effect]]}}
{{defn|}}

{{term|[[Gibbard–Satterthwaite theorem]]}}
{{defn|}}

{{term|[[Gibbard's theorem]]}}
{{defn|}}

{{term|[[Gibrat's law]]}}
{{defn|}}

{{term|[[Gibson's paradox]]}}
{{defn|}}

{{term|[[Giffen good]]}}
{{defn|}}

{{term|[[gift economy]]}}
{{defn|}}

{{term|[[Gini coefficient]]}}
{{defn|}}

{{term|[[global labor arbitrage]]}}
{{defn|}}

{{term|[[gold standard]]}}
{{defn|}}

{{term|[[good (economics)|good]]}}
{{defn|}}

{{term|[[Goodhart's law]]}}
{{defn|}}

{{term|[[Goodwin model (economics)|Goodwin model]]}}
{{defn|}}

{{term|[[Gorman polar form]]}}
{{defn|}}

{{term|[[Gossen's laws|Gossen's 1st law]]}}
{{defn|}}

{{term|[[Gossen's second law|Gossen's 2nd law]]}}
{{defn|}}

{{term|[[Gossen's laws|Gossen's 3rd law]]}}
{{defn|}}

{{term|[[government revenue]]}}
{{defn|The total {{gli|revenue}} received by all three levels of government (federal, state, and local) in the form of {{gli|tax|taxes}} and {{gli|tariff|tariffs}}.}}

{{term|[[government spending]]}}
{{defn|The total {{gli|expenditure}} made by all three levels of government (federal, state, and local) for public services.}}

{{term|[[grand supercycle]]}}
{{defn|}}

{{term|[[great moderation]]}}
{{defn|}}

{{term|[[Green economy]]}}
{{defn|}}

{{term|[[The Green Paradox|Green paradox]]}}
{{defn|}}

{{term|[[Greenwood–Hercowitz–Huffman preferences]]}}
{{defn|}}

{{term|[[Gresham's law]]}}
{{defn|}}

{{term|[[Grinold and Kroner Model]]}}
{{defn|}}

{{term|[[Grosch's law]]}}
{{defn|}}

{{term|[[gross domestic product (GDP)]]}}{{anchor|gross domestic product (GDP)}}
{{defn|The value of all goods and services produced in the economy in a given period of time, usually a quarter or a year.}}

{{term|[[gross income]]}}
{{defn|All sources of total income before any deductions or taxes are withdrawn.}}

{{term|[[gross national income|gross national income (GNI)]]}}
{{defn|}}

{{term|[[gross private domestic investment]]}}
{{defn|}}

{{term|[[Grossman model of health demand]]}}
{{defn|}}

{{term|[[growth recession]]}}
{{defn|A situation in which economic growth is slow but not low enough to be a {{gli|recession}}, yet unemployment still increases.}}<ref>[http://www.ezonomics.com/whatis/a_growth_recession What is a growth recession?] {{Webarchive|url=https://web.archive.org/web/20190429162220/https://www.ezonomics.com/whatis/a_growth_recession/ |date=2019-04-29 }} by Phil Thornton, 26 April 2012</ref>

{{term|[[guns versus butter model]]}}
{{defn|}}
{{glossaryend}}

==H==
{{glossary}}
{{term|[[Happiness economics]]}}
{{defn|Theoretical, qualitative and quantitative study of happiness and [[quality of life]], including positive and negative [[Affect (psychology)|affects]], [[well-being]],<ref>{{cite web|url=http://www.lse.ac.uk/researchAndExpertise/researchImpact/caseStudies/layard-happiness-wellbeing-public-policy.aspx|title=Making personal happiness and wellbeing a goal of public policy|publisher=London School of Economics|access-date=4 April 2018|archive-date=4 April 2018|archive-url=https://web.archive.org/web/20180404200745/http://www.lse.ac.uk/researchAndExpertise/researchImpact/caseStudies/layard-happiness-wellbeing-public-policy.aspx|url-status=dead}}</ref> [[life satisfaction]] and related concepts.}}

{{term|[[Harrington paradox]]}}
{{defn|}}

{{term|[[Harris–Todaro model]]}}
{{defn|}}

{{term|[[Harrod–Domar model]]}}
{{defn|}}

{{term|[[Hauser's law]]}}
{{defn|}}

{{term|[[health economics]]}}
{{defn|}}

{{term|[[health insurance]]}}
{{defn|A contracted program where the person insured receives payment for health services when needed in return for a monthly premium payment. Firms may offer some payment of premiums to their employees as part of a benefits package.}}

{{term|[[Heckscher–Ohlin model]]}}
{{defn|}}

{{term|[[Heckscher–Ohlin theorem]]}}
{{defn|}}

{{term|[[hedonic index]]}}
{{defn|}}

{{term|[[hedonic regression]]}}
{{defn|}}

{{term|[[Henry George theorem]]}}
{{defn|}}

{{term|[[Herfindahl–Hirschman index]]}}
{{defn|}}

{{term|[[heterodox economics]]}}
{{defn|Any {{gli|economics|economic}} {{gli|school of economic thought|school of thought}} or theory that contrasts with {{gli|mainstream economics}}.}}

{{term|[[Hicksian demand function]]}}
{{defn|}}

{{term|[[hiding hand principle]]}}
{{defn|}}

{{term|[[Hindu rate of growth]]}}
{{defn|}}

{{term|[[Hirschman cycle]]}}
{{defn|}}

{{term|[[Historical school of economics|historical school]]}}
{{defn|}}

{{term|[[history of economic thought]]}}
{{defn|The study of the history of the philosophies of the different thinkers and theories in the subject known today as {{gli|economics}}, from {{gli|ancient economic thought}} to contemporary economic thought.}}

{{term|[[Hodrick–Prescott filter]]}}
{{defn|}}

{{term|[[Holmström's theorem]]}}
{{defn|}}

{{term|[[home bias in trade puzzle]]}}
{{defn|}}

{{term|[[home bias puzzle (disambiguation)|home bias puzzle]]}}
{{defn|}}

{{term|[[homo economicus]]}}
{{defn|}}

{{term|[[Hotelling's law]]}}
{{defn|}}

{{term|[[Hotelling's lemma]]}}
{{defn|}}

{{term|[[hourglass economy]]}}
{{defn|}}

{{term|household}}
{{defn|The sector of the economy which purchases goods from the product market and sells labor, land, and entrepreneurship ability to the factor market in the circular flow market.}}

{{term|[[housing starts]]}}
{{defn|The number of new houses being built during a period of time.}}

{{term|[[Huff model]]}}
{{defn|}}

{{term|[[human capital]]}}
{{defn|The knowledge and skills that people use to help them produce {{gli|output}}.}}

{{term|[[human capital flight]]}}
{{defn|}}

{{term|[[humanistic economics]]}}
{{defn|}}

{{term|[[hyperinflation]]}}
{{defn|{{gli|inflation|Inflation}} which occurs at an extremely high rate, usually in excess of 20 or 30 per cent per month.}}
{{glossaryend}}

==I==
{{glossary}}
{{term|[[Icarus paradox]]}}
{{defn|}}

{{term|[[immiserizing growth]]}}
{{defn|}}

{{term|[[implicit cost]]}}
{{defn|}}

{{term|import}}
{{defn|}}

{{term|[[import substitution industrialization]]}}
{{defn|}}

{{term|[[import quota]]}}
{{defn|}}

{{term|[[impossible trinity]]}}
{{defn|}}

{{term|[[imputation (game theory)|imputation]]}}
{{defn|}}

{{term|[[Inada conditions]]}}
{{defn|}}

{{term|[[incentive]]}}
{{defn|}}

{{term|income}}
{{defn|}}

{{term|[[income distribution]]}}
{{defn|}}

{{term|[[income effect]]}}
{{defn|The change in {{gli|consumption}} resulting from a change in {{gli|income}}.}}

{{term|[[income elasticity of demand]] (YED)}}
{{defn|Measures the sensitivity of a good's demand to income.}}

{{term|[[Income tax]]}}
{{defn|A tax levied on income, weather being on an individual or a business.}}

{{term|increasing returns}}
{{defn|A situation where each additional amount of a resource used in a production process brings forth successively larger amounts of output.}}

{{term|[[indifference curve]]}}
{{defn|}}

{{term|[[Indigo Era]]}}
{{defn|}}

{{term|[[indirect inference]]}}
{{defn|}}

{{term|[[Individual Retirement Account]] (IRA)}}
{{defn|A retirement (savings) instrument that allows a person to save money through time while deferring {{gli|tax|taxes}} on that income until retirement.}}

{{term|[[induced consumption]]}}
{{defn|}}

{{term|[[induced demand]]}}
{{defn|}}

{{term|[[industrial organization]]}}
{{defn|}}

{{term|[[Industry (economics)|industry]]}}
{{defn|A sector of the economy in which different firms produce similar or identical goods or services.}}

{{term|[[inelastic demand]]}}
{{defn|{{gli|demand|Demand}} that is not very sensitive to changes in {{gli|price}}, such that changes in price have a relatively small effect on the quantity of the good demanded. Contrast ''{{gli|elastic demand}}''.}}

{{term|[[inferior good]]}}
{{defn|}}

{{term|inflation}}
{{defn|When the overall level of prices in the economy is rising.}}

{{term|[[inflationism]]}}
{{defn|}}

{{term|inflation rate}}
{{defn|A measure of how the overall level of {{gli|price|prices}} in the economy changes over time. If the inflation rate is positive, prices are rising; if the inflation rate is negative, prices are falling.}}

{{term|[[inflation targeting]]}}
{{defn|}}

{{term|[[information asymmetry]]}}
{{defn|}}

{{term|[[information economics]]}}
{{defn|}}

{{term|[[input–output model]]}}
{{defn|}}

{{term|[[installment credit]]}}
{{defn|A loan that offers a borrower a fixed, amount of money over a specified period of time. This way, the borrower knows upfront the number of monthly payments, or "installments," they will need to make and how much each monthly payment will be for the life of the loan.}}

{{term|[[institutional complementarity]]}}
{{defn|}}

{{term|[[institutional economics]]}}
{{defn|An approach to {{gli|economics}} which focuses on the roles of [[sociocultural evolution]] and institutions in shaping economic behavior.}}

{{term|insurance}}
{{defn|A contracted agreement for an exchange of money for a guarantee of compensation at the time of a loss, damage, illness, or death. }}

{{term|[[insurance co-pay]]}}
{{defn|A fixed amount paid by an insured individual for a healthcare service.}}

{{term|[[insurance deductible]]}}
{{defn|The amount paid by the insured individual before any payment is made by the insurer.}}

{{term|[[insurance policy limit]]}}
{{defn|The maximum or total amount an insurer will pay for losses or damages to assets or health services to people.}}

{{term|[[intensity of preference]]}}
{{defn|}}

{{term|interest}}
{{defn|}}

{{term|interest rate}}
{{defn|The price you have to pay to borrow money.}}

{{term|[[interest rate parity]]}}
{{defn|}}

{{term|[[intermediate consumption]]}}
{{defn|}}

{{term|[[international economics]]}}
{{defn|}}

{{term|[[international futures]]}}
{{defn|}}

{{term|[[international trade]]}}
{{defn|}}

{{term|[[intertemporal choice]]}}
{{defn|}}

{{term|[[intertemporal equilibrium]]}}
{{defn|}}

{{term|[[intra-industry trade]]}}
{{defn|}}

{{term|[[inventory bounce]]}}
{{defn|}}

{{term|investment}}
{{defn|Any increase in the economy's stock of {{gli|capital}}.}}

{{term|[[investment fund]]}}
{{defn|}}

{{term|[[invisible hand]]}}
{{defn|Adam Smith's famous idea that when constrained by {{gli|competition}}, each firm's greed causes it to act in a socially optimal way, as if guided to do the right thing by an invisible hand.}}

{{term|[[IS–LM model]]}}
{{defn|}}

{{term|[[IS/MP model]]}}
{{defn|}}

{{term|[[isoquant]]}}
{{defn|}}
{{glossaryend}}

==J==
{{glossary}}
{{term|[[Jaimovich–Rebelo preferences]]}}
{{defn|}}

{{term|[[JEL classification codes]]}}
{{defn|}}

{{term|[[Jevons paradox]]}}
{{defn|}}

{{term|[[Joan Robinson's growth model]]}}
{{defn|}}

{{term|[[job demands-resources model]]}}
{{defn|}}

{{term|[[job hunting]]}}
{{defn|}}

{{term|[[joint product pricing]]}}
{{defn|}}

{{term|[[Jones model]]}}
{{defn|}}

{{term|[[Juglar cycle]]}}
{{defn|}}

{{term|[[just price]]}}
{{defn|A theory of ethics which attempts to set standards of fairness for economic transactions.}}
{{glossaryend}}

==K==
{{glossary}}
{{term|[[Kaldor–Hicks efficiency]]}}
{{defn|}}

{{term|[[Kaldor's facts]]}}
{{defn|}}

{{term|[[Kaldor's growth laws]]}}
{{defn|}}

{{term|[[Kaldor's growth model]]}}
{{defn|}}

{{term|[[Keynes effect]]}}
{{defn|}}

{{term|[[Keynesian beauty contest]]}}
{{defn|}}

{{term|[[Keynesian cross]]}}
{{defn|}}

{{term|[[Keynesian economics]]}}
{{ghat|Also called '''Keynesianism'''.}}
{{defn|A diverse set of {{gli|macroeconomics|macroeconomic}} theories about how in the {{gli|short run}} (and especially during {{gli|recession|recessions}}) economic {{gli|output}} can be strongly influenced by the total amount of spending that occurs within an economy, known as {{gli|aggregate demand}}. Keynesian economists generally argue that because aggregate demand is often unstable and behaves erratically, it does not necessarily or predictably equal the {{gli|aggregate supply}}, which can cause {{gli|market economy|market economies}} to experience inefficient macroeconomic outcomes in the form of {{gli|recession|recessions}} (when demand is low) and {{gli|inflation}} (when demand is high), and that these outcomes can be mitigated by {{gli|monetary policy}} actions by a {{gli|central bank}} and {{gli|fiscal policy}} actions by a government authority, which can help stabilize output over the {{gli|business cycle}}.}}

{{term|[[Keynes–Ramsey rule]]}}
{{defn|}}

{{term|[[Keynes's theory of wages and prices]]}}
{{defn|}}

{{term|[[Khazzoom–Brookes postulate]]}}
{{defn|}}

{{term|[[King–Plosser–Rebelo preferences]]}}
{{defn|}}

{{term|[[Kitchin cycle]]}}
{{defn|}}

{{term|[[Kiyotaki–Moore model]]}}
{{defn|}}

{{term|[[Knightian uncertainty]]}}
{{defn|A lack of any quantifiable knowledge about some possible occurrence, as opposed to the presence of quantifiable risk (e.g., that in statistical noise or a parameter's confidence interval). The concept acknowledges some fundamental degree of ignorance, a limit to knowledge, and an essential unpredictability of future events.}}

{{term|[[knowledge spillover]]}}
{{defn|}}

{{term|[[Kondratiev wave]]}}
{{defn|}}

{{term|[[Kraków School of Economics|Kraków school]]}}
{{defn|}}

{{term|[[Kuhn's theorem]]}}
{{defn|}}

{{term|[[Kuznets curve]]}}
{{defn|}}

{{term|[[Kuznets swing]]}}
{{defn|}}
{{glossaryend}}

==L==
{{glossary}}
{{term|[[Wage labour|labor]]}}
{{defn|People's physical and mental talents and efforts that are used to help produce goods and services.  Wage earners usually get paid a set amount of money per hour.}}

{{term|[[labor economics]]}}
{{defn|}}

{{term|[[labor rights]]}}
{{defn|}}

{{term|[[labor theory of value]]}}
{{defn|}}

{{term|[[Laffer curve]]}}
{{defn|}}

{{term|''[[laissez-faire]]''}}
{{defn|}}

{{term|[[Lange model]]}}
{{defn|}}

{{term|Lausanne school}}
{{defn|}}

{{term|[[law of demand]]}}
{{defn|An economic rule stating that quantity {{gli|demand|demanded}} and {{gli|price}} move in opposite directions, i.e. as demand increases, price decreases, and vice versa.}}

{{term|[[Marginal utility|law of diminishing marginal utility]]}}
{{defn|An economic rule stating that the additional satisfaction a {{gli|consumer}} gets from purchasing one more unit of a product will decrease with each additional unit purchased.}}

{{term|[[law of increasing costs]]}}
{{defn|}}

{{term|[[law of supply]]}}
{{defn|}}

{{term|[[Leakage (economics)|leakage]]}}
{{defn|}}

{{term|[[leakage effect]]}}
{{defn|}}

{{term|[[leapfrogging]]}}
{{defn|}}

{{term|[[lease]]}}
{{defn|}}

{{term|[[Lehman wave]]}}
{{defn|}}

{{term|[[lemon market]]}}
{{defn|}}

{{term|lending}}
{{defn|}}

{{term|[[Leontief paradox]]}}
{{defn|}}

{{term|[[Leontief production function]]}}
{{defn|}}

{{term|[[Leontief utilities]]}}
{{defn|}}

{{term|[[leprechaun economics]]}}
{{defn|Distortion of national accounts data by corporate tax schemes.}}

{{term|[[Lerman ratio]]}}
{{defn|}}

{{term|[[Lerner index]]}}
{{defn|An index ranging from 0 to 1 that measures a firm's [[market power]] given the price it sets and its marginal cost.}}

{{term|[[Lerner paradox]]}}
{{defn|}}

{{term|[[Lerner symmetry theorem]]}}
{{defn|}}

{{term|[[Lewis–Mogridge position]]}}
{{defn|}}

{{term|[[Liability (financial accounting)|liability]]}}
{{defn|Financial responsibility for something.}}

{{term|[[liberal paradox]]}}
{{defn|}}

{{term|[[limit price]]}}
{{defn|}}

{{term|loan}}
{{defn|}}

{{term|[[local multiplier effect]]}}
{{ghat|Also called the '''local premium'''}}
{{defn|The additional economic benefit accrued to a geographic area from money being spent in the local economy.}}

{{term|[[local tax]]}}
{{defn|Any {{gli|tax}} paid to a city or county, e.g. sales taxes, school taxes, or property taxes.}}

{{term|[[Location model (economics)|location model]]}}
{{defn|}}

{{term|[[long run]]}}
{{defn|}}

{{term|long-run shutdown condition}}
{{defn|A situation where a firm's total revenues exceed its ''variable costs'' but are less than its total costs. The firm continues to operate until its ''fixed cost'' contracts expire.}}

{{term|long-term financing}}
{{defn|}}

{{term|[[LoopCo]]}}
{{defn|}}

{{term|loose money policy}}
{{defn|A monetary policy that makes {{gli|credit}} inexpensive and abundant, possibly leading to {{gli|inflation}}.}}

{{term|[[Lorenz curve]]}}
{{defn|}}

{{term|[[loss aversion]]}}
{{defn|}}

{{term|[[Lucas critique]]}}
{{defn|}}

{{term|[[Lucas paradox]]}}
{{defn|}}

{{term|[[Lundberg lag]]}}
{{defn|}}

{{term|[[luxury goods|luxury good]]}}
{{defn|}}
{{glossaryend}}

== M ==
{{glossary}}
{{term|[[macroeconomic model]]}}
{{defn|}}

{{term|[[macroeconomic policy instruments]]}}
{{defn|}}

{{term|[[macroeconomic populism]]}}
{{defn|}}

{{term|[[macroeconomic regulation and control]]}}
{{defn|}}

{{term|[[macroeconomics]]}}
{{defn|The study of the economy as a whole, concentrating on
economy-wide factors such as interest rates, inflation, and unemployment. Macroeconomics also encompasses the study of economic growth and how governments use monetary and fiscal policy to try to moderate the harm caused by recessions.}}

{{term|[[mainstream economics]]}}
{{ghat|Also called '''orthodox economics'''.}}
{{defn|The body of knowledge, theories, and {{gli|economic model|models}} of {{gli|economics}}, as taught by universities worldwide, that are generally accepted by {{gli|economist|economists}} as a basis for discussion. Contrast ''{{gli|heterodox economics}}''.}}

{{term|[[major trading partner]]}}
{{defn|In international trading, a country or group of countries with which one country trades more than with others.}}

{{term|[[Malthusian growth model]]}}
{{defn|}}

{{term|[[Malthusianism]]}}
{{defn|}}

{{term|[[managerial economics]]}}
{{defn|}}

{{term|[[Mandeville's paradox]]}}
{{defn|}}

{{term|[[manorialism]]}}
{{defn|}}

{{term|[[Marchetti's constant]]}}
{{defn|}}

{{term|[[marginal cost]]}}
{{defn|The additional increase in total cost when one more unit of output is produced.}}

{{term|[[marginal efficiency of capital]]}}
{{defn|}}

{{term|[[marginalism]]}}
{{defn|}}

{{term|[[marginal product of capital]]}}
{{defn|}}

{{term|[[marginal product of labor]]}}
{{defn|}}

{{term|[[marginal propensity to consume]]}}
{{defn|}}

{{term|[[marginal propensity to import]]}}
{{defn|}}

{{term|[[marginal propensity to save]]}}
{{defn|}}

{{term|[[marginal rate of substitution]]}}
{{defn|}}

{{term|[[marginal rate of technical substitution]]}}
{{defn|}}

{{term|[[marginal revenue]]}}
{{defn|The additional {{gli|income}} earned from selling one more unit of a good; sometimes equal to {{gli|price}}.}}

{{term|[[marginal utility]]}}
{{defn|The change in total utility that results from consuming the next unit of a {{gli|good}} or {{gli|service}}. Marginal utility can be positive or negative.}}

{{term|[[marginal value]]}}
{{defn|}}

{{term|[[Market (economics)|market]]}}
{{defn|}}

{{term|[[market basket]]}}
{{defn|A bundle of goods and services selected to measure {{gli|inflation}}. Economists define a market basket, such as the {{gli|Consumer Price Index}}, and then track how much money it takes to buy this basket from one period to the next.}}

{{term|[[market economy]]}}
{{defn|An {{gli|economy}} in which almost all economic activity happens in {{gli|market|markets}}, with little or no interference by the government; often referred to as a ''{{gli|laissez-faire}}'' ("leave alone") economic system.}}

{{term|[[market failure]]s}}
{{defn|Situations where markets deliver socially non-optimal outcomes. Two common causes of market failure are asymmetric information and public goods.}}

{{term|[[market structure]]}}
{{defn|The structure of a {{gli|market}} as a whole, taking into consideration two main factors: the number of firms in the market and whether goods offered are identical, similar, or differentiated.}}

{{term|market production}}
{{defn|Term that economists use to capture what happens when one individual offers to make or sell something to another individual at a price agreeable to both.}}

{{term|[[market system]]}}
{{defn|}}

{{term|markets}}
{{defn|Places where buyers and sellers come together to trade money for a good or service.}}

{{term|[[Marshallian demand function]]}}
{{defn|}}

{{term|[[Marxian economics]]}}
{{defn|}}

{{term|Master's Degree}}
{{defn|A postgraduate academic degree completed after a bachelor's degree in which the student studies a specific topic of their choice.  It is usually awarded by a research university after the completion of its program requirements, normally two more years.}}

{{term|[[Matthew effect]]}}
{{defn|}}

{{term|[[Mayfield's paradox]]}}
{{defn|}}

{{term|[[Meade Conflict]]}}
{{defn|}}

{{term|[[medium of exchange]]}}
{{defn|}}

{{term|[[mental accounting]]}}
{{defn|}}

{{term|[[menu cost]]}}
{{defn|}}

{{term|[[mercantilism]]}}
{{defn|}}

{{term|[[merger simulation]]}}
{{defn|}}

{{term|[[Metcalfe's law]]}}
{{defn|}}

{{term|''[[Methodenstreit]]''}}
{{ghat|German for "method dispute."}}
{{defn|A controversy in {{gli|economic methodology}} between {{gli|economist|economists}} of the {{gli|Austrian School}} and those of the {{gli|Historical School}} that commenced in the 1880s and persisted for more than a decade.}}

{{term|[[Metzler paradox]]}}
{{defn|}}

{{term|[[microeconomics]]}}
{{defn|A branch of economics that studies individual people and individual businesses. For people, microeconomics studies how they behave when faced with decisions about where to spend their money or how to invest their savings. For businesses, it studies how profit-maximising firms behave individually, as well as when competing against each other in markets.}}

{{term|[[Mincer earnings function]]}}
{{defn|}}

{{term|[[minimum wage]]}}
{{defn|}}

{{term|[[Minsky moment]]}}
{{defn|}}

{{term|[[missing market]]}}
{{defn|}}

{{term|[[mixed economy]]}}
{{defn|An economic system blending elements of a market economy with elements of a planned economy, free markets with state interventionism, or private enterprise with public enterprise.}}

{{term|[[mobile payment]]}}
{{defn|Mobile payments are payments made via the use of a mobile device, such as a smartphone or tablet, to pay for goods, services, or bills. Mobile payments can be made remotely or near, meaning the customer's device is in the same location as the merchant's point of sale (POS).}}

{{term|[[modern monetary theory]]}}
{{defn|}}

{{term|[[modern portfolio theory]]}}
{{defn|}}

{{term|[[modified gross national income]]}}
{{defn|}}

{{term|[[Modigliani–Miller theorem]]}}
{{defn|}}

{{term|[[monetarism]]}}
{{defn|A school of thought in {{gli|monetary economics}} which emphasizes the role of governments in controlling the amount of {{gli|money}} in {{gli|circulation}} (the {{gli|money supply}}). Monetarists assert that variations in the money supply have major influences on national {{gli|output}} in the short run and on {{gli|price level|price levels}} over longer periods, and that the objectives of {{gli|monetary policy}} are best met by targeting the growth rate of the money supply rather than by engaging in {{gli|discretionary policy}}.}}

{{term|[[monetary circuit theory]]}}
{{defn|}}

{{term|[[monetary-disequilibrium theory]]}}
{{defn|}}
 
{{term|[[monetary economics]]}}
{{defn|}}

{{term|[[monetary/fiscal debate]]}}
{{defn|}}

{{term|[[monetary policy]]}}
{{defn|Using changes in the {{gli|money supply}} to change {{gli|interest rate|interest rates}} to stimulate or slow down economic activity.}}

{{term|[[monetary reform]]}}
{{defn|}}

{{term|[[monetary system]]}}
{{defn|}}

{{term|money}}
{{defn|Anything customarily used as a {{gli|medium of exchange}}, a {{gli|unit of account|unit of accounting}}, and a {{gli|store of value}}.}}

{{term|[[money illusion]]}}
{{defn|}}

{{term|[[money market account (MMA)]]}}
{{defn|A savings account that earns interest and that has some checking account features.}}

{{term|[[money multiplier]]}}
{{defn|}}

{{term|[[money supply]]}}
{{defn|}}

{{term|[[MONIAC]]}}
{{defn|}}

{{term|[[monopolistic competition]]}}
{{defn|A situation in which many firms with slightly
different products compete. Production costs are above what may be achieved by perfectly competitive firms, but society benefits from the product
differentiation.}}

{{term|monopoly}}
{{defn|A firm with no competitors in its industry. A monopoly firm produces less output, has higher costs, and sells its output for a higher price than it would if constrained by competition.}}

{{term|[[monopsony]]}}
{{defn|}}

{{term|[[moral hazard]]}}
{{defn|}}

{{term|mortgage}}
{{defn|}}

{{term|[[motivation]]}}
{{defn|}}

{{term|[[moving equilibrium theorem]]}}
{{defn|}}

{{term|[[Multiplier (economics)|multiplier]]}}
{{defn|}}

{{term|[[multiplier uncertainty]]}}
{{defn|Any lack of perfect knowledge of the multiplier effect of a particular policy action, such as a monetary or fiscal policy change, upon the intended target of the policy.}}

{{term|[[Mundell–Fleming model]]}}
{{defn|}}

{{term|[[mutual fund]]}}
{{defn|}}

{{term|[[mutual fund separation theorem]]}}
{{defn|}}

{{term|[[Mutualism (economic theory)|mutualism]]}}
{{defn|}}
{{glossaryend}}

== N ==
{{glossary}}
{{term|[[Nakamura number]]}}
{{defn|}}

{{term|[[Nash equilibrium]]}}
{{defn|}}

{{term|[[national average salary]]}}
{{defn|}}

{{term|[[national income and product accounts]]}}
{{defn|}}

{{term|[[National income policy agreement (Finland)|national income policy agreement]]}}
{{defn|}}

{{term|[[national tax]]}}
{{defn|Any {{gli|tax}} paid to a national or federal government, e.g. income tax, tariffs, and social security taxes.}}

{{term|[[national wealth]]}}
{{defn|The total value of {{gli|capital}} and private property that is owned within a country.}}

{{term|[[natural monopoly]]}}
{{defn|An industry in which one large producer can produce output at a lower cost than many small producers. It undersells its rivals and ends up as the only firm surviving in its industry.}}

{{term|[[natural resource economics]]}}
{{defn|}}

{{term|[[need]]}}
{{defn|Any good or service that is fundamentally necessary for survival, such as food, clothing, and shelter.}}

{{term|[[Neoclassical economics]]}}
{{defn|}}

{{term|[[Neoclassical synthesis]]}}
{{defn|}}

{{term|[[Neoliberalism]]}}
{{defn|}}

{{term|[[Neo-Ricardianism]]}}
{{defn|}}

{{term|[[Neo-Schumpeterian economics]]}}
{{defn|}}

{{term|[[net income]]}}
{{defn|The income amount that is left over after all deductions and income taxes are withdrawn.}}

{{term|[[net national income]]}}
{{defn|}}

{{term|[[net national product]]}}
{{defn|}}

{{term|[[network effect]]}}
{{defn|}}

{{term|[[New Keynesian economics]]}}
{{defn|}}

{{term|[[new trade theory]] (NTT)}}
{{defn|}}

{{term|nominal interest rates}}
{{defn|Interest rates that measure the returns to a loan
in terms of money borrowed and money returned (as opposed to real interest rates).}}

{{term|nominal prices}}
{{defn|Money prices, which can change over time due to inflation. (See also ''{{gli|real prices}}''.)}}

{{term|nominal wages}}
{{defn|Wages measured in money. (See also ''{{gli|real wages}}''.)}}

{{term|[[Non-convexity (economics)|non-convexity]]}}
{{defn|}}

{{term|[[non-price determinant of demand]]}}
{{defn|Any reason other than {{gli|price}} that changes the will to buy a good or service, for example, fads, income, taste, future expectation, and population.}}

{{term|[[non-price determinant of supply]]}}
{{defn|Any reason other than {{gli|price}} that changes the will to produce a good or service, for example, changes in taxes and input costs, price of substitutes, future expectations, and changes in technology.}}

{{term|[[Rivalry (economics)|non-rivalry]]}}
{{defn|}}

{{term|[[normal good]]}}
{{defn|}}

{{term|[[normative economics]]}}
{{defn|The part of economics that deals with [[normative statement]]s, i.e., statements expressing a value judgment about the desirability of a situation. As opposed to {{gli|positive economics}}.}}

{{term|[[North–South model]]}}
{{defn|}}

{{term|[[Norwegian paradox]]}}
{{defn|}}

{{term|[[no-trade theorem]]}}
{{defn|}}
{{glossaryend}}

== O ==
{{glossary}}
{{term|[[occupational choice model]]}}
{{defn|}}

{{term|[[occupational licensing]]}}
{{defn|}}

{{term|[[Okun's law]]}}
{{defn|}}

{{term|[[Okishio's theorem]]}}
{{defn|}}

{{term|oligopoly}}
{{defn|An industry with only a few firms. If these firms collude, they form a {{gli|cartel}}, which may reduce output and drive up profits in the same way a {{gli|monopoly}} does.}}

{{term|[[oligopsony]]}}
{{defn|}}

{{term|[[Open Energy Modelling Initiative]]}}
{{defn|}}

{{term|[[open energy system models]]}}
{{defn|}}

{{term|open-market operations}}
{{defn|The buying and selling of government bonds by a central bank; that is, transactions that take place in the public, or open, bond market.}}

{{term|[[open music model]]}}
{{defn|}}

{{term|[[opportunity cost]]}}
{{defn|The value of the next best alternative thing that could have been done. It measures what is given up to do the most preferred thing.}}

{{term|[[ordinary good]]}}
{{defn|}}

{{term|[[organizational economics]]}}
{{defn|}}

{{term|[[Elinor Ostrom#Ostrom's law|Ostrom's law]]}}
{{defn|}}

{{term|[[Overheating (economics)|overheating]]}}
{{defn|}}

{{term|[[overlapping generations model]]}}
{{defn|}}

{{term|[[overshooting model]]}}
{{defn|}}

{{term|[[overtaking criterion]]}}
{{defn|}}
{{glossaryend}}

== P ==
{{glossary}}
{{term|[[Price index#Paasche and Laspeyres price indices|Paasche price index]]}}
{{defn|A {{gli|price index}} method which measures the amount of money at current-year prices that an individual requires to purchase a current-year bundle of goods and services divided by the cost of purchasing that same bundle in a base year.}}

{{term|[[Pacman conjecture]]}}
{{defn|}}

{{term|[[parable of the broken window]]}}
{{defn|}}

{{term|[[paradox of competition]]}}
{{defn|}}

{{term|[[paradox of flexibility]]}}
{{defn|}}

{{term|[[paradox of prosperity]]}}
{{defn|}}

{{term|[[paradox of thrift]]}}
{{defn|}}

{{term|[[paradox of toil]]}}
{{defn|}}

{{term|[[paradox of value]]}}
{{defn|}}

{{term|parallel economic model}}
{{defn|}}

{{term|[[parental dividend]]}}
{{defn|}}

{{term|[[Pareto efficiency]]}}
{{ghat|Also called '''Pareto optimality'''.}}
{{defn|In [[welfare economics]], a situation if all possible Pareto improvements have already been made; in other words, there are no longer any ways left to make one person better-off, without making some other person worse-off.<ref>{{Cite web |title=Martin J. Osborne |url=https://economics.utoronto.ca/osborne/ |access-date=2022-12-10 |website=economics.utoronto.ca}}</ref>}}

{{term|[[Pareto principle]]}}
{{defn|}}

{{term|[[Participation (ownership)|participation]]}}
{{defn|}}

{{term|[[participatory economics]]}}
{{defn|}}

{{term|partnership}}
{{defn|A business that two or more individuals own and operate together.}}

{{term|[[pay check stub (statement)]]}}
{{defn|An itemization of income, taxes withheld, benefits payments (if any), and other information that are presented to an employee of a firm every time they are paid.}}

{{term|[[pay-day lending]]}}
{{defn|A relatively small amount of money lent at a high rate of interest on the agreement that it will be repaid when the borrower receives their next paycheck.}}

{{term|[[Peltzman effect]]}}
{{defn|}}

{{term|[[penetration pricing]]}}
{{defn|}}

{{term|per capita}}
{{defn|A {{gli|unit of account}} per person, usually placed at the end of an {{gli|economic indicator}}.}}

{{term|[[perfect competition]]}}
{{defn|A situation where numerous small firms producing
identical products compete against each other in a given industry. Perfect competition leads to firms producing the ''socially optimal output level'' at the minimum possible cost per unit.}}

{{term|[[personal property]]}}
{{defn|Possessions such as jewelry, furniture, and real estate that people can amass through time.}}

{{term|[[Phillips curve]]}}
{{defn|}}
 
{{term|[[physical capital]]}}
{{defn|All human-made goods that are used to produce other goods and services, such as tools, machines, and buildings.}}

{{term|[[physiocracy]]}}
{{defn|}}

{{term|[[Pigou effect]]}}
{{defn|}}

{{term|[[Pigouvian tax]]}}
{{defn|}}

{{term|[[Polak model]]}}
{{defn|}}

{{term|[[policy mix]]}}
{{defn|}}

{{term|[[policy-ineffectiveness proposition]]}}
{{defn|}}

{{term|[[polytomous choice]]}}
{{defn|}}

{{term|[[population economics]]}}
{{defn|See ''{{gli|demographic economics}}''.}}

{{term|[[Pork cycle]]}}
{{defn|}}

{{term|[[positive economics]]}}
{{defn|The part of economics that deals with [[positive statement]]s, i.e., statements concerning what "is," "was," or "will be," excluding statements of what is, was, or will be moral. As opposed to {{gli|normative economics}}.}}

{{term|[[post-Keynesian economics]]}}
{{defn|}}

{{term|[[List of unsolved problems in economics#International economics|PPP puzzle]]}}
{{defn|}}

{{term|[[Prebisch–Singer hypothesis]]}}
{{defn|}}

{{term|[[predatory lending]]}}
{{defn|Predatory lending is a practice that involves deception, fraud, or aggressive sales tactics to lead a borrower into a loan that is not what they expected. The goal is to make it difficult for the borrower to repay debt, often resulting in the borrower paying too much in fees and/or interest.}}

{{term|[[Preference (economics)|preference]]}}
{{defn|}}

{{term|[[premium of insurance]]}}
{{defn|The dollar price for acquiring an insurance policy.}}

{{term|[[price]]}}
{{defn|The amount of {{gli|money}} it takes to buy a product or produce a product.}}
 
{{term|[[price ceiling]]}}
{{defn|A market intervention in which the government ensures that the price of a good or service stays below the free market price.}}

{{term|[[price controls]]}}
{{defn|}}

{{term|[[price discrimination]]}}
{{defn|}}

{{term|[[price elasticity of demand]] (PED)}}
{{defn|Measures the sensitivity of a good's demand to its price.}}

{{term|[[price elasticity of supply]] (PES)}}
{{defn|Measures the sensitivity of a good's supply to its price.}}

{{term|[[price floor]]}}
{{defn|A market intervention in which the government keeps the price of a good or service above its free-market price.}}

{{term|[[price index]]}}
{{defn|A normalized average of {{gli|price}} relatives for a given class of goods or services in a given region and during a given period of time. It is a statistic designed to help to compare how these price relatives, taken as a whole, differ between geographical locations or time periods. Notable price indices include {{gli|consumer price index}}, {{gli|producer price index}}, and {{gli|GDP deflator}}.}}

{{term|[[price level]]}}
{{defn|}}

{{term|[[price point]]}}
{{defn|}}

{{term|[[price–specie flow mechanism]]}}
{{defn|}}

{{term|[[price war]]}}
{{defn|}}

{{term|[[pricing]]}}
{{defn|}}

{{term|[[pricing science]]}}
{{defn|The application of social and business science methods to the problem of setting prices.}}

{{term|[[prime rate]]}}
{{ghat|Also called the '''prime lending rate'''.}}
{{defn|The {{gli|interest rate}} at which a {{gli|bank}} will agree to {{gli|loan|lend}} to customers with good credit. {{gli|floating interest rate|Floating interest rates}} are often expressed as a percentage above or below the prime rate.}}

{{term|[[principal–agent problem]]}}
{{defn|}}

{{term|[[principle of effective demand]]}}
{{defn|}}

{{term|[[private good]]}}
{{ghat|Also called '''private property ownership'''.}}
{{defn|An item that yields positive benefits to people that is excludable, i.e. its owners can prevent others from using the good or consuming its benefits. A private good, as an economic resource is scarce, which can cause competition for it.}}

{{term|[[wikt:producer|producer]]}}
{{defn|An entity, either a person or firm, which supplies goods or services.}}

{{term|[[producer price index]]}}
{{defn|}}

{{term|[[Economic surplus|producer surplus]]}}
{{defn|The gain that producers receive when they can sell their output at a price higher than the minimum amount for which they are willing to make it.}}

{{term|[[product differentiation]]}}
{{defn|}}

{{term|[[product market]]}}
{{defn|In the circular flow model, the sector which facilitates goods and output from firms to households in return for revenue and profit.}}

{{term|[[Production (economics)|production]]}}
{{defn|}}

{{term|[[production possibilities curve]]}}
{{defn|A graph showing the maximal combinations of goods and services that can be produced from a fixed amount of resources in a given period of time.}}

{{term|productive efficiency}}
{{defn|A term describing firms that produce goods and services at the lowest possible cost.}}

{{term|[[productivism]]}}
{{defn|}}

{{term|[[productivity paradox]]}}
{{defn|}}

{{term|[[production set]]}}
{{defn|}}

{{term|[[Proebsting's paradox]]}}
{{defn|}}

{{term|[[Profit (economics)|profit]]}}
{{defn|}}

{{term|[[profit motive]]}}
{{defn|}}

{{term|[[progressive tax]]}}
{{defn|A tax schedule that states that the more income one earns, the higher the tax rate will be.}}

{{term|[[property tax]]}}
{{defn|A tax levied on a property which is usually based on its value or a transfer of ownership.}}

{{term|[[proportional tax]]}}
{{ghat|Also called a '''flat tax'''.}}
{{defn|A tax schedule that states that regardless of income, the same tax rate will be applied to all income earners.}}

{{term|[[prospect theory]]}}
{{defn|}}

{{term|[[proxemics]]}}
{{defn|}}

{{term|[[public bad]]}}
{{defn|}}

{{term|[[public choice]]}}
{{defn|}}

{{term|[[public economics]]}}
{{defn|defn=Or '''economics of the public sector''', is the study of government policy through the lens of [[economic efficiency]] and [[equity (economics)|equity]]. Public economics builds on the theory of [[welfare economics]] and is ultimately used as a tool to improve social welfare.}}

{{term|[[Public good (economics)|public good]]}}
{{defn|Goods or services that cannot be profitably produced by private firms because they are impossible to provide to just one person; if you provide them to one person, you have to provide them to everybody. Public goods non-excludable (you can't prevent anyone from consuming them) and non-rival (it costs no extra to supply one extra person).}}

{{term|[[pure competition]]}}
{{defn|}}

{{term|[[purchasing power]]}}
{{defn|The value of the sum of money and the ability of buying products with that money.}}

{{anchor|purchasing power parity}}{{term|[[purchasing power parity]] (PPP)}}
{{defn|}}
{{glossaryend}}

== Q ==
{{glossary}}
{{anchor|quantitative easing}}{{term|[[quantitative easing]] (QE)}}
{{defn|}}

{{term|quantity demanded}}
{{defn|The amount of a good or service that a {{gli|consumer}} is able and willing to purchase at a given price based on their income and preferences.}}

{{term|quantity supplied}}
{{defn|The amount of a good or service that a {{gli|supplier}} is able and willing to produce at a given market price.}}

{{term|[[quantity theory of money]]}}
{{defn|The theory that the overall level of prices in the economy is proportional to the quantity of money circulating in the economy.}}

{{term|[[wikt:quota|quota]]}}
{{defn|A limited quantity of a product that can be produced, imported, or exported.}}
{{glossaryend}}

==R==
{{glossary}}
{{term|[[Rabin fairness]]}}
{{defn|}}

{{term|[[Ragnar Nurkse's balanced growth theory]]}}
{{defn|}}

{{term|[[Rahn curve]]}}
{{defn|}}

{{term|[[Ramsey problem]]}}
{{defn|}}

{{term|[[Ramsey–Cass–Koopmans model]]}}
{{defn|}}

{{term|[[rate of profit]]}}
{{defn|}}

{{term|[[rate of return pricing]]}}
{{defn|}}

{{term|[[rational choice]]}}
{{defn|The idea of making choices by using logic and that people will choose the most beneficial of the options afforded.}}

{{term|[[rational choice institutionalism]]}}
{{defn|}}

{{term|[[rational choice theory]]}}
{{defn|}}

{{term|[[rational expectations]]}}
{{defn|The theory that people optimally change their behaviour in response to policy changes. Depending on the situation, their behavioural changes can greatly limit the effectiveness of policy changes.}}

{{term|[[rational pricing]]}}
{{defn|}}

{{term|[[rationing]]}}
{{defn|}}

{{term|[[Reaganomics]]}}
{{defn|}}

{{term|[[real business-cycle theory]]}}
{{defn|}}

{{term|[[real income effect]]}}
{{defn|The change in {{gli|consumption}} resulting from a change in {{gli|income}}, adjusted for {{gli|inflation}}.}}

{{term|real interest rates}}
{{defn|Interest rates that compensate for inflation by measuring the returns to a loan in terms of units of stuff lent and units of stuff returned (as opposed to ''nominal interest rates'').}}

{{term|[[real GDP]]}}
{{defn|{{gli|gross domestic product|Gross domestic product}} that has been adjusted for {{gli|inflation}} by applying the price deflator.}}

{{term|real prices}}
{{defn|How much of one kind of thing (such as hours worked) you have to give up to get a good or service, no matter what happens to ''nominal prices''.}}

{{term|real wages}}
{{defn|Wages measured not in terms of money itself (as ''nominal wages'' are) but rather in terms of how much output that money can buy.}}

{{term|[[Rebound effect (conservation)|rebound effect]]}}
{{defn|}}

{{term|[[recession]]s}}
{{defn|Part of the {{gli|business cycle}} during which an economy's total output falls.}}

{{term|recoveries}}
{{defn|Part of the [[business cycle]] during which an economy's total output expands.}}

{{term|[[reflation]]}}
{{defn|}}

{{term|[[regenerative economic theory]]}}
{{defn|}}

{{term|[[regional science]]}}
{{defn|}}

{{term|[[regressive tax]]}}
{{defn|A tax schedule that states that the more income one earns, the lower the tax burden.}}

{{term|regulation}}
{{defn|Government restrictions on a business firm.}}

{{term|[[relative price]]}}
{{defn|}}

{{term|[[Renting|rent]]}}
{{defn|The price for borrowing real estate.  This can be residential or commercial for example, an apartment or office building.}}

{{term|[[repugnancy costs]]}}
{{defn|}}

{{term|[[repugnant market]]}}
{{defn|}}

{{term|[[resource]]}}
{{defn|}}

{{term|[[resource curse]]}}
{{defn|}}

{{term|[[resource depletion]]}}
{{defn|}}
 
{{term|[[resource market]]}}
{{defn|(Also known as a factor market.) In the circular flow model, the sector which facilitates resources from household to firms in return for income payment.}}

{{term|[[retail sales]]}}
{{defn|Purchases of finished goods and services by households and firms.}}

{{term|[[returns to scale]]}}
{{defn|}}

{{term|[[revealed comparative advantage]]}}
{{defn|}}

{{term|[[revealed preference]]}}
{{defn|}}

{{term|[[revenue]]}}
{{defn|Total {{gli|income}} from sales of output.}}

{{term|[[Revolving Credit]]}}
{{defn|Revolving credit is a line of credit that remains available over time, even if the balance is paid in full. Borrowers can access credit up to a certain amount and then have ongoing access to that amount.}}

{{term|[[Ricardian economics]]}}
{{defn|}}

{{term|[[Ricardian equivalence]]}}
{{defn|}}

{{term|[[Ricardian socialism]]}}
{{defn|}}

{{term|rights}}
{{defn|}}

{{term|[[right to work law]]}}
{{defn|A state law forbidding labor unions from forcing workers to join and pay union dues.}}
 
{{term|[[risk aversion]]}}
{{defn|}}

{{term|[[risk premium]]}}
{{defn|}}

{{term|[[risk-return relationship]]}}
{{defn|The direct relationship between the risk of an investment and its expected return or profit; the higher the risk, the higher the opportunity for gain or loss and vice versa.}}

{{term|[[Rivalry (economics)|rivalry]]}}
{{defn|}}

{{term|[[Robin Hood effect]]}}
{{defn|}}

{{term|[[Robinson Crusoe economy]]}}
{{defn|}}

{{term|[[Robustness (economics)|Robustness]]}}
{{defn|The ability of a financial trading system to remain effective.<ref>{{Cite web
  | last1 = Kuorikoski
  | first1 = Jaakko
  | last2 = Lehtinen
  | first2 = Aki
  | last3 = Marchionni
  | first3 = Caterina
  | title = ECONOMICS AS ROBUSTNESS ANALYSIS
  | publisher = University of Pittsburgh
  | date = 2007-09-25
  | url = http://philsci-archive.pitt.edu/archive/00003550/01/econrobu.pdf
  | format =
  | doi =
  | accessdate = 4 May 2010}}</ref>}}

{{term|[[Rostovian take-off model]]}}
{{defn|}}

{{term|[[Rostow's stages of growth]]}}
{{defn|}}

{{term|[[Roth 401k]]}}
{{defn|A Roth 401(k) is an employer-sponsored retirement savings account that is funded using after-tax dollars. This means that income tax is paid immediately on the earnings that the employee deducts from each paycheck and deposits into the account. Withdrawals from the account are tax-free upon retirement.}}

{{term|[[Roy model]]}}
{{defn|}}

{{term|[[Roy's identity]]}}
{{defn|}}

{{term|[[Rybczynski theorem]]}}
{{defn|}}
{{glossaryend}}

== S ==
{{glossary}}
{{term|[[School of Salamanca#Economics|Salamanca school]]}}
{{defn|}}

{{term|salary}}
{{defn|An income amount paid to an employee of a firm; it is usually a set amount per year.}}

{{term|[[saltwater economics]]}}
{{defn|}}

{{term|[[saving]]}}
{{defn|}}

{{term|[[saving identity]]}}
{{defn|}}

{{term|[[Say's law]]}}
{{defn|}}

{{term|[[scarcity]]}}
{{defn|Any situation in which people do not have enough resources to satisfy all of their {{gli|want|wants}}. The phenomenon of scarcity is what creates the need for economics.}}

{{term|[[Schelling's model of segregation]]}}
{{defn|}}

{{term|[[school of economic thought]]}}
{{defn|A group of {{gli|economist|economists}} who share or shared a mutual perspective on the way {{gli|economy|economies}} function.}}

{{term|[[Scitovsky paradox]]}}
{{defn|}}

{{term|[[Economic sector|sector]]}}
{{defn|A portion or component of the larger {{gli|economy}}, such as households, firms, or the government.}}

{{term|[[sectoral balances]]}}
{{defn|}}

{{term|[[seigniorage]]}}
{{defn|}}

{{term|[[service (economics)|service]]}}
{{defn|}}

{{term|[[service economy]]}}
{{defn|}}

{{term|[[service recovery paradox]]}}
{{defn|}}

{{term|[[Shephard's lemma]]}}
{{defn|}}

{{term|[[shift work]]}}
{{defn|}}

{{term|[[Shock therapy (economics)|shock therapy]]}}
{{defn|}}

{{term|[[short run]]}}
{{defn|}}

{{term|[[shortage]]}}
{{defn|}}

{{term|short-run shutdown condition}}
{{defn|A situation in which a firm's total {{gli|revenue|revenues}} are less than its {{gli|variable cost|variable costs}}, and the firm is better off shutting down immediately and losing only its {{gli|fixed cost|fixed costs}}.}}

{{term|[[shrinkflation]]}}
{{defn|}}

{{term|[[sick leave]]}}
{{defn|A benefit given to employees of a firm as a condition of employment where an employee can take days off in case they do not feel well.}}

{{term|[[Sisyphism]]}}
{{defn|}}

{{term|[[Smihula waves]]}}
{{defn|}}

{{term|[[snob effect]]}}
{{defn|A situation where the demand for a certain good by individuals of a higher income level is inversely related to its demand by those of a lower income level.<ref>"Snob Effect Definition." BusinessDictionary.com – Online Business Dictionary. Web. 06 Jan. 2011. <http://www.businessdictionary.com/definition/snob-effect.html {{Webarchive|url=https://web.archive.org/web/20200220193029/http://www.businessdictionary.com/definition/snob-effect.html |date=2020-02-20 }}>.</ref>}}

{{term|[[social behavior]]}}
{{defn|}}

{{term|[[social choice theory]]}}
{{defn|}}

{{term|[[social dividend]]}}
{{defn|}}

{{term|[[social mobility]]}}
{{defn|}}

{{term|[[socialist economics]]}}
{{defn|An economic system in which the government owns some of the factors of production including entire industries, for example, the healthcare system of the country.}}

{{term|[[sociality]]}}
{{defn|}}

{{term|[[social multiplier effect]]}}
{{defn|Any situation when an individual's marginal utility of an action increases because his peers also participate in this action. For example, researchers have shown that people are more likely to exercise when their peers exercise.<ref>{{cite journal | last1=Carrell | first1=Scott E. | last2=Hoekstra | first2=Mark | last3=West | first3=James E. | title=Is poor fitness contagious? | journal=Journal of Public Economics | publisher=Elsevier BV | volume=95 | issue=7–8 | year=2011 | issn=0047-2727 | doi=10.1016/j.jpubeco.2010.12.005 | pages=657–663 |citeseerx=10.1.1.296.5005 }}</ref>}}

{{term|socially optimal output level}}
{{defn|The output level that maximises the benefits that society can get from its limited supply of resources.}}

{{term|[[social welfare function]]}}
{{defn|}}

{{term|[[social welfare model]]}}
{{defn|}}

{{term|[[socioeconomics]]}}
{{ghat|Also called '''social economics'''.}}
{{defn|}}

{{term|[[sole proprietorship]]}}
{{defn|A business owned and operated by one person.}}

{{term|[[solidarity economy]]}}
{{defn|}}

{{term|[[Solow residual]]}}
{{defn|}}

{{term|[[Solow–Swan model]]}}
{{defn|}}

{{term|[[Sonnenschein–Mantel–Debreu theorem]]}}
{{defn|}}

{{term|[[sovereign wealth fund]]}}
{{defn|}}

{{term|[[stabilization policy]]}}
{{defn|}}

{{term|[[stagflation]]}}
{{defn|A simultaneous economic phenomenon during which {{gli|inflation}} and unemployment are both rising.}}

{{term|[[standard of deferred payment]]}}
{{defn|}}
 
{{term|[[standard of living]]}}
{{defn|}}

{{term|state tax}}
{{defn|Any {{gli|tax}} paid to a state government, e.g. [[State sales tax|sales taxes]], [[state income tax]], and license plate fees.}}

{{term|[[steady-state economy]]}}
{{defn|}}

{{term|sticky prices}}
{{defn|Prices that are slow to adjust to shocks. Price stickiness can cause recessions to linger.}}

{{term|[[stochastic frontier analysis]]}}
{{defn|}}

{{term|[[stock market]]}}
{{defn|A secondary market where securities, stocks for example, are bought and sold.}}

{{term|[[stock-flow consistent model]]}}
{{defn|}}

{{term|[[Stockholm School]]}}
{{defn|}}

{{term|[[stocks (corporate stocks)]]}}
{{defn|Shares of ownership of a corporation that entitles the owner to a portion of the profits or dividends.}}

{{term|[[Stolper–Samuelson theorem]]}}
{{defn|}}

{{term|[[store of value]]}}
{{defn|}}

{{term|[[St. Petersburg paradox]]}}
{{defn|}}

{{term|[[strategic complements]]}}
{{defn|}}

{{term|[[Strauss–Howe generational theory]]}}
{{defn|}}

{{term|[[structural unemployment]]}}
{{defn|Unemployment created due to a decrease in demand for the skills of a worker.}}

{{term|[[subgame perfect equilibrium]]}}
{{defn|}}

{{term|[[subjective theory of value]]}}
{{defn|}}

{{term|[[substitute good]]}}
{{defn|A product that can satisfy the utility of another.}}

{{term|[[substitution effect]]}}
{{defn|When consumers react to an increase in a good's price by consuming less of that good and more of other goods.}}

{{term|[[sunk costs]]}}
{{defn|}}

{{term|[[Sunspots (economics)|sunspot]]}}
{{defn|}}

{{term|[[sunspot equilibrium]]}}
{{defn|}}

{{term|[[Supply (economics)|supply]]}}
{{defn|The total amount of a certain type of {{gli|good}} that has been produced and is available.}}
 
{{term|[[supply and demand]]}}
{{defn|An economic model of markets that separates buyers from sellers and then summarises each group's behaviour with a single line on a graph. The buyers’ behaviour is captured by the ''demand curve'', whereas the sellers’ behaviour is captured by the ''supply curve''. By putting these two curves on the same graph, economists can show how buyers and sellers interact in markets to determine how much of any particular item is going to be sold, as well as the {{gli|price}} at which it is likely to be sold.}}

{{term|[[supply chain]]}}
{{defn|}}

{{term|[[supply curve]]}}
{{defn|A line on a graph that represents how much of a good or service sellers are going to produce at various prices.}}
 
{{term|[[supply (economics)|supply schedule]]}}
{{defn|A chart that lists how much of a good a supplier will offer at different prices.}}

{{term|[[supply shock]]}}
{{defn|A sudden shortage of a good.}}

{{term|[[supply-side economics]]}}
{{defn|A theory in {{gli|macroeconomics}} which postulates that lowering tax rates, decreasing government regulation, and allowing free trade is the most effective way to foster economic growth because greater supplies of goods and services at lower prices cause employment to increase and consumers to spend more. Contrast ''{{gli|demand-side economics}}''.}}

{{term|[[Economic surplus|surplus]]}}
{{defn|A situation in which supply is greater than demand, usually as the result of high prices.}}
{{glossaryend}}

== T ==
{{glossary}}
{{term|[[tableau économique]]}}
{{defn|}}

{{term|[[tatonnement]]}}
{{defn|}}

{{term|[[tariff]]}}
{{ghat|Also called '''duty'''.}}
{{defn|A {{gli|tax}} imposed by the government of a country, or by a supranational union of countries or institutions, on {{gli|import|imports}} or {{gli|export|exports}} of goods. Import duties may serve as a source of revenue for the government as well as a form of regulation of foreign trade by taxing foreign products to encourage or safeguard domestic industries that produce the same or similar products. Along with {{gli|import quota|import}} and {{gli|export quota|export quotas}}, tariffs are among the most commonly used instruments of {{gli|protectionism}}.}}

{{term|tax}}
{{defn|}}

{{term|[[tax-benefit model]]}}
{{defn|}}

{{term|[[tax benefits of debt]]}}
{{defn|}}

{{term|[[tax credit]]}}
{{defn|}}

{{term|[[tax deduction]]}}
{{defn|}}

{{term|[[tax rate]]}}
{{defn|}}

{{term|[[taxable income]]}}
{{defn|The amount of income that is subject to being taxed. This amount may or may not be the total gross income of a person or firm.}}

{{term|[[Taylor rule]]}}
{{defn|}}

{{term|[[technological theory of social production]]}}
{{defn|}}

{{term|[[terms of trade]]}}
{{defn|The rules that countries impose on each other to trade with each other.}}

{{term|[[Thatcherism]]}}
{{defn|}}

{{term|[[theory of the firm]]}}
{{defn|}}

{{term|[[theory of the second best]]}}
{{ghat|Also called '''the general theory of second best''' or '''the second best theorem'''.}}
{{defn|A theory that concerns the situation when one or more [[perfect market|optimality conditions]] cannot be satisfied. It shows that if one optimality condition in an [[economic model]] cannot be satisfied, it is possible that the next-best solution involves changing other variables away from the values that would otherwise be optimal.<ref name="Lipsey">{{Cite journal | last1 = Lipsey | first1 = R. G. | last2 = Lancaster | first2 = Kelvin | year = 1956 | title = The General Theory of Second Best | journal = [[Review of Economic Studies]] | volume = 24 | issue = 1 | pages = 11–32 | jstor = 2296233 | doi = 10.2307/2296233 }}</ref>}}

{{term|[[thermoeconomics]]}}
{{defn|}}

{{term|[[Thirlwall's Law]]}}
{{defn|}}

{{term|[[throw away paradox]]}}
{{defn|}}

{{term|[[tight money policy]]}}
{{defn|Federal Reserve System actions that contract the growth of the nation's money supply for the purpose of reducing or eliminating inflation.}}

{{term|[[time preference]]}}
{{defn|}}

{{term|[[time preference theory of interest]]}}
{{defn|}}

{{term|[[time value of money]]}}
{{defn|}}

{{term|[[Topkis's theorem]]}}
{{defn|}}

{{term|[[Törnqvist index]]}}
{{ghat|Also called '''Törnqvist-Theil index'''.}}
{{defn|A price or quantity index that measures the [[weighted]] [[geometric mean]] of the relatives using [[arithmetic average]]s of the value shares in two or more periods as weights.<ref>[http://stats.oecd.org/glossary/detail.asp?ID=2711 Glossary], [[Organisation for Economic Co-operation and Development|OECD]]</ref>}}

{{term|[[total cost]]}}
{{defn|}}

{{term|total surplus}}
{{defn|The sum of {{gli|producer surplus}} and {{gli|consumer surplus}}.}}

{{term|[[trade]]}}
{{ghat|Also called '''exchange'''.}}
{{defn|The transfer of {{gli|good|goods}} and {{gli|service|services}} from one person or entity to another.}}

{{term|traditional economy}}
{{defn|An economy in which production and distribution are handled along the lines of long-standing cultural traditions.}}

{{term|[[tragedy of the anticommons]]}}
{{defn|}}

{{term|[[tragedy of the commons]]}}
{{defn|}}

{{term|[[transaction cost]]}}
{{defn|A {{gli|cost}} in making any economic trade when participating in a [[Market (economics)|market]].<ref>[http://fixglobal.com/home/buy-side-firms-use-tca-to-measure-execution-performance/ Buy-side Use TCA to Measure Execution Performance] {{Webarchive|url=https://web.archive.org/web/20201028003146/http://fixglobal.com/home/buy-side-firms-use-tca-to-measure-execution-performance/ |date=2020-10-28 }}, FIXGlobal, June 2010</ref>}}

{{term|[[transfer payment]]}}
{{defn|Any redistribution of income and wealth by means of the government making a payment, without goods or services being received in return.}}

{{term|[[transfer payments multiplier]]}}
{{ghat|Also called '''transfer payment multiplier'''}}
{{defn|The multiplier by which [[aggregate demand]] will increase when there is an increase in [[transfer payments]] (e.g., welfare spending, unemployment payments).<ref name="Macroeconomics and Business  ">{{cite book|last=Macdonald|first=Nadia Tempini |title=Macroeconomics and business  |year=1994 |pages=138|publisher=Cengage Learning |isbn=1-86152-450-1|url=https://books.google.com/books?id=MU3StwEAyz0C&q=Transfer+payment+multiplier&pg=PA138}}</ref>}}

{{term|[[transfer pricing]]}}
{{defn|}}

{{term|[[transformation problem]]}}
{{defn|}}

{{term|[[transport economics]]}}
{{defn|}}

{{term|[[triangle model]]}}
{{defn|}}

{{term|[[Triffin dilemma]]}}
{{defn|}}

{{term|[[Trough (economics)|trough]]}}
{{defn|}}

{{term|[[Tullock paradox]]}}
{{defn|}}

{{term|[[turnpike model of money]]}}
{{defn|}}

{{term|[[turnpike theory]]}}
{{defn|}}
{{glossaryend}}

== U ==
{{glossary}}
{{term|[[ultimatum game]]}}
{{defn|An asymmetrical, two player game that has become a popular instrument of economic experiments.}}

{{term|[[underemployment]]}}
{{defn|Working at a job for which one is overqualified, or working part-time when full-time work is desired.}}

{{term|unemployment}}
{{defn|Under-use of any {{gli|factor of production}}, most commonly referring to {{gli|labor}}.}}

{{term|[[unit of account]]}}
{{defn|}}

{{term|U.S. Dollar}}
{{defn|The official currency of the United States, usually abbreviated as USD.}}

{{term|[[unitary elastic]]}}
{{defn|}}

{{term|[[universal bank]]}}
{{defn|}}

{{term|[[universal basic income]]}}

{{term|[[unplanned spending]]}}
{{defn|Spending that takes place without prior consideration or budgeting.}}

{{term|[[unsecured credit]]}}
{{defn|A loan that does not require collateral from the borrower. Instead, lenders approve unsecured loans based on the borrower's creditworthiness.}}

{{term|[[unskilled labor]]}}
{{defn|{{gli|labor|Labor}} that requires no specialized skills, education, or training to perform.}}

{{term|[[urban economics]]}}
{{defn|}}

{{term|[[utilitarianism]]}}
{{defn|}}

{{term|[[utility]]}}
{{defn|The usefulness of a good or service in satisfying a need or a want.}}

{{term|[[utility maximization problem]]}}
{{defn|}}

{{term|[[utility representation theorem]]}}
{{defn|}}

{{term|[[Uzawa condition]]}}
{{defn|}}

{{term|[[Uzawa–Lucas model]]}}
{{defn|}}

{{term|[[Uzawa's theorem]]}}
{{defn|}}
{{glossaryend}}

== V ==
{{glossary}}

{{term|[[vacation pay]]}}
{{defn|A benefit to employees by a firm where employees can take time off for leisure.  This benefit is usually given in amounts of weeks.}}

{{term|[[value (economics)|value]]}}
{{defn|A measure of the benefit provided by a {{gli|good}} or {{gli|service}} to an {{gli|agent|economic agent}}.}}

{{term|[[value-added tax]] (VAT)}}
{{defn|}}

{{term|[[variable cost]]s}}
{{defn|Any cost that changes in proportion to the amount of goods or services that a firm produces.<ref name="GNB pp 48">Garrison, Noreen, Brewer. Ch 2 – Managerial Accounting and Costs Concepts, pp 48</ref> Variable costs are also the sum of {{gli|marginal cost|marginal costs}} over all units produced.}}

{{term|[[Veblen good]]}}
{{defn|}}
 
{{term|[[velocity of money]]}}
{{ghat|Also called the '''velocity of circulation of money'''.}}
{{defn|Refers to how fast {{gli|money}} passes from one holder to the next. It can refer to the '''income velocity of money''', which is the frequency with which the average same unit of currency is used to purchase newly domestically produced goods and services within a given time period.<ref name="fred2m2v">{{cite web  | title = Money Velocity | date = January 1959 | publisher = Federal Reserve Bank of St. Louis | url = http://research.stlouisfed.org/fred2/series/M2V  | access-date = October 28, 2013}}</ref> In other words, it is the number of times one unit of money is spent to buy goods and services per unit time.<ref name="fred2m2v"/>}}

{{term|[[Verdoorn's law]]}}
{{defn|}}

{{term|[[Virginia school of political economy|Virginia school]]}}
{{defn|}}

{{term|[[Von Neumann–Morgenstern utility theorem]]}}
{{defn|}}
{{glossaryend}}

==W==
{{glossary}}
{{term|wage}}
{{defn|The monetary compensation (or [[remuneration]], personnel expenses, labor) paid by an employer to an employee in exchange for work done. Payment is typically calculated as a fixed amount for each task completed (a ''task wage'' or [[piece rate]]), or at an hourly or daily rate ([[wage labour]]), or based on some other easily measured quantity of work done.}}

{{term|[[wage labour]]}}
{{defn|}}

{{term|[[wage slavery]]}}
{{defn|}}

{{term|[[Wagner's law]]}}
{{defn|}}

{{term|[[Walras's law]]}}
{{defn|}}

{{term|[[want]]}}
{{defn|Wants are often distinguished from needs. A need is something that is necessary for survival (such as food and shelter), whereas a want is simply something that a person would like to have. Some economists have rejected this distinction and maintain that all of these are simply wants, with varying levels of importance. By this viewpoint, wants and needs can be understood as examples of the overall concept of demand.}}

{{term|wealth}}
{{defn|The [[abundance (economics)|abundance]] of [[Value (economics)|valuable]] [[financial asset]]s or [[property|physical possessions]] which can be converted into a form that can be used for [[financial transaction|transactions]]. This includes the core meaning as held in the originating old English word ''weal'', which is from an [[Indo-European languages|Indo-European]] word stem.<ref>{{cite web|url=http://dictionary.reference.com/browse/weal|title=weal|work=[[The American Heritage Dictionary of the English Language]]|edition=4th|publisher=Houghton Mifflin Company|access-date=February 21, 2009}}</ref> The modern concept of wealth is of significance in all areas of {{gli|economics}}, especially for {{gli|economic growth|growth economics}} and {{gli|development economics}}, yet the meaning of wealth is context-dependent. Individuals or companies possessing a substantial {{gli|net worth}} are often referred to as ''wealthy''. Net worth is defined as the current value of one's {{gli|asset|assets}} less {{gli|liability|liabilities}} (excluding the principal in trust accounts).<ref>{{Cite web|url=http://movies2.nytimes.com/books/first/s/stanley-millionaire.html|title=The Millionaire Next Door|website=movies2.nytimes.com|access-date=2018-09-27}}</ref>}}

{{term|[[wealth effect]]}}
{{defn|The change in spending that accompanies a change in perceived {{gli|wealth}}.<ref>• Darby, Michael R. (1987). "wealth effect," ''[[The New Palgrave: A Dictionary of Economics]]'', v. 4, pp. 883–4.<br/>&nbsp;&nbsp; • {{cite web|url=http://www.portfolio.com/views/blogs/odd-numbers/2008/06/17/in-praise-of-the-wealth-effect|title=In Praise of the Wealth Effect – Economics Blog – Zubin Jelveh – Odd Numbers – Portfolio.com|publisher=portfolio.com|access-date=2009-04-20|last=Jelveh|first=Zubin}}</ref> Usually the wealth effect is positive: spending changes in the same direction as perceived wealth.}}

{{term|welfare}}
{{defn|A type of government support for the citizens of that society. Welfare may be provided to people of any income level, as with [[social security]] (and is then often called a [[social safety net]]), but it is usually intended to ensure that people can meet their basic human needs such as food and shelter. Welfare attempts to provide a minimal level of [[well-being]], usually either a free- or a subsidized-supply of certain goods and social services, such as [[universal healthcare|healthcare]], education, and [[vocational training]].<ref name="Modern Thought Third Edition 1999 p. 919">''The New Fontana Dictionary of Modern Thought'' Third Edition (1999), Allan Bullock and Stephen Trombley Eds., p. 919.</ref>}}

{{term|[[welfare cost of business cycles]]}}
{{defn|}}

{{term|[[welfare cost of inflation]]}}
{{defn|}}

{{term|[[welfare economics]]}}
{{defn|A branch of economics that uses {{gli|microeconomics|microeconomic}} techniques to evaluate [[well-being]] (welfare) at the aggregate (economy-wide) level.<ref>{{citation |last=Deardorff |first=Alan V. |title=Welfare economics |work=Deardorffs' Glossary of International Economics |access-date=9 June 2014 |url=http://www-personal.umich.edu/~alandear/glossary/w.html#WelfareEconomics |year=2014}}</ref>}}

{{term|[[welfare trap]]}}
{{defn|}}

{{term|[[Weller's theorem]]}}
{{defn|}}

{{anchor|willingness to accept}}{{term|[[willingness to accept]] (WTA)}}
{{defn|The minimum amount of money that а person is willing to accept to abandon a good or to put up with something negative, such as pollution. It is equivalent to the minimum monetary amount required for sale of a good or acquisition of something undesirable to be accepted by an individual.}}

{{anchor|willingness to pay}}{{term|[[willingness to pay]] (WTP)}}
{{defn|The maximum price at or below which a consumer will definitely buy one unit of a product.<ref>Varian, Hal R. (1992), Microeconomic Analysis, Vol. 3. New York: W.W. Norton.</ref> This corresponds to the standard economic view of a consumer [[reservation price]]. Some researchers, however, conceptualize WTP as a range.}}

{{term|[[Wonderland model]]}}
{{defn|}}

{{term|[[workforce productivity]]}}
{{defn|}}

{{term|[[World3]]}}
{{defn|}}

{{term|[[World3 nonrenewable resource sector]]}}
{{defn|}}

{{term|[[Wright's Law]]}}
{{defn|}}
{{glossaryend}}

==X==
{{glossary}}
{{term|[[x-efficiency]]}}
{{defn|}}

{{term|[[x-inefficiency]]}}
{{defn|}}
{{glossaryend}}

==Y==
{{glossary}}
{{term|[[Yield (finance)|yield]]}}
{{defn|In {{gli|finance}}, the yield on a {{gli|security}} is the amount of cash (in percentage terms) that returns to the owners of the security, in the form of interest or dividends received from it. Normally, it does not include the price variations, distinguishing it from the total {{gli|return}}. Yield applies to various stated rates of return on stocks (common and preferred, and [[Convertible bond|convertible]]), fixed income instruments (bonds, notes, bills, strips, zero coupon), and some other investment type insurance products (e.g. {{gli|annuity|annuities}}).}}
{{glossaryend}}

==Z==
{{glossary}}
{{term|[[Zelder paradox]]}}
{{defn|}}

{{term|[[zero-sum game]]}}
{{defn|In [[game theory]] and [[economic theory]], a zero-sum game is a [[Mathematical model|mathematical representation]] of a situation in which each participant's gain or loss of [[utility]] is exactly balanced by the losses or gains of the utility of the other participants. If the total gains of the participants are added up and the total losses are subtracted, they will sum to zero. Thus, [[Fair cake-cutting|cutting a cake]], where taking a larger piece reduces the amount of cake available for others as much as it increases the amount available for that taker, is a zero-sum game if all participants value each unit of cake equally (see {{gli|marginal utility}}).}}
{{glossaryend}}

==See also==
*[[Outline of economics]]
*[[Index of economics articles]]

==References==
{{Reflist}}

{{Economics |expanded}}
{{Glossaries of science and engineering}}

[[Category:Glossaries of science|Economics]]
[[Category:Economics lists]]
[[Category:Risk]]
[[Category:Wikipedia glossaries|Economics]]
[[Category:Wikipedia glossaries using description lists]]