Glossary of economics

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This glossary of economics is list of definitions about economics, its sub-disciplines, and related fields.

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A supply and demand diagram, illustrating the effects of an increase in demand
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A

• Absolute advantage – the ability of a party (an individual, or firm, or country) to produce a greater quantity of a good, product, or service than competitors, using the same amount of resources.
• Adaptive expectations – is a hypothesized process by which people form their expectations about what will happen in the future based on what has happened in the past.
• Aggregate demand –
• Aggregate supply –
• Aggregation problem –
• Agent – is an actor and more specifically a decision maker in a model of some aspect of the economy.
• Agricultural economics – is an applied field of economics concerned with the application of economic theory in optimizing the production and distribution of food.
• Allocative efficiency –
• Antitrust law –
• Applied economics –
• Appropriate technology –
• Arbitrage – is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices.
• Arrow's impossibility theorem –
• Austrian School –
• Autarky –
• Automatic stabilizer –
• Autonomous consumption –
• Average cost – or unit cost is equal to total cost divided by the number of goods produced (the output quantity, Q). It is also equal to the sum of variable costs (total variable costs divided by Q) plus average fixed costs (total fixed costs divided by Q).
• Average fixed cost – is the fixed costs of production (FC) divided by the quantity (Q) of output produced. Fixed costs are those costs that must be incurred in fixed quantity regardless of the level of output produced.
• Average variable cost – is a firm's variable costs (labour, electricity, etc.) divided by the quantity of output produced. Variable costs are those costs which vary with the output.
• Average tax rate –

B

• Backward induction –
• Balance of payments –
• Balance of trade –
• Balanced budget –
• Bank –
• Barriers to entry –
• Barter –
• Behavioral economics –
• Bellman equation –
• Bequest motive –
• Bertrand–Edgeworth model –
• Black–Scholes model –
• Bond –
• Break-even point –
• Bretton Woods system –
• Budget deficit –
• Budget set –
• Budget surplus –
• Big push model –
• Business cycle –
• Business economics –
• Business sector –

C

• Capacity utilization –
• Capital –
• Capital cost –
• Capital flight –
• Capital good –
• Central bank –
• Circular flow of income –
• Circulation –
• Competition law –
• Complementary good – Goods that are bought and used together.
• Computational economics –
• Consumer choice –
• Consumer confidence –
• Consumer price index –
• Consumer surplus –
• Consumption –
• Consumption function –
• Contract curve –
• Contract theory –
• Convexity –
• Cost –
• Cost-benefit analysis –
• Cost curve –
• Cost-of-production theory of value –
• Cost overrun –
• Credit bureau –
• Credit card –
• Creditor –
• Credit rating –
• Crowding out –
• Cultural economics –
• Currency –
• Current account –
• Cyclical unemployment – Unemployment resulting from the business cycle. It is unpredictable.

D

• Deadweight loss –
• Deflation –
• Deflator –
• Demand deposit –
• Demand shock –
• Deregulation –
• Diminishing returns –
• Depreciation
• Depression –
• Discretionary income –
• Disposable income –
• Dissaving –
• Distribution –
• Duopoly – A situation in which there are only two suppliers for a good or service.
• Dynamic stochastic general equilibrium –

E

• Econometrics –
• Economic efficiency –
• Economic equilibrium –
• Economic growth –
• Economic indicator – Any measurable unit of the economy which helps economists make predictions or assess the past such as unemployment and gross domestic product.
• Economic model –
• Economic rent –
• Economic shortage –
• Economic surplus – The state in which supply of a good exceeds demand, usually as a result of the current price being below the economic equilibrium.
• Economic system –
• Economics –
• Economies of scale –
• Economist –
• Economy –
• Effective demand –
• Elastic demand – Demand that is not sensitive to price changes.
• Elasticity –
• Engineering economics –
• Environmental economics –
• Equal opportunity –
• Equilibrium – The point at which quantity demanded and quantity supplied are equal and both consumer and producer are satisfied.
• Equity (economics) –
• Excess supply –
• Exchange rate –
• Excludability –
• Expected utility hypothesis –
• Expeditionary economics -
• Experimental economics –
• Externality –

F

• Factors of production –
• Financial economics –
• Fiscal policy –
• Fixed cost –
• Frictional unemployment – Unemployment that is a result of workers moving from one job to another, as opposed to Structural Unemployment.
• Full employment –
• Functions of money –
• Future value –

G

• General equilibrium theory –
• General Theory of Employment, Interest and Money –
• Goods and services –
• Government – The laws, agents, and agencies who make, execute, and interpret laws and make decisions for us.
• Government Revenue - Money received by all three levels of government (federal, state, and local) in the form of taxes and tariffs.
• Government spending – Money spent by any of the three levels of government (federal, state, and local) for public services.
• Gross domestic product –

H

• Housing starts – The number of new houses being built during a period of time.
• Hyperinflation – Monetary inflation occurring at an extremely high rate.

I

• Implicit cost –
• Import quota –
• Imports –
• Incentive –
• Income distribution –
• Income effect – The change in consumption resulting from a change in income.
• Indifference curve –
• Industrial organization –
• Inelastic demand – Demand that is not very sensitive to a change in price.
• Inflation –
• Information economics –
• Interest –
• Interest rate –
• International economics –
• Intertemporal choice –
• Inventory bounce -
• Investment –
• IS–LM model –

J

• JEL classification codes –
• Job hunting –
• Joint product pricing –
• Just price –

K

• Keynesian economics –

L

• Labour economics –
• Law of demand – Economic rule stating that the quantity demanded and price move in opposite directions.
• Law of Diminishing Marginal Utility – Economic rule stating that the additional satisfaction a consumer gets from purchasing one more unit of a product will decrease with each additional unit purchased.
• Law of increasing costs –
• Law of supply –
• Lease –
• List of symbols –
• Local taxes – Taxes paid to a city or county for example sales taxes, school taxes, or property taxes.
• Long-term financing –
• Loose money policy – Monetary policy that makes credit inexpensive and abundant, possibly leading to inflation.

M

• Macroeconomics –
• Managerial economics –
• Marginal cost – The incremental cost of producing one additional unit.
• Marginal product of labor –
• Marginal propensity to consume –
• Marginal revenue – The additional income from selling one more unit of a good; sometimes equal to price.
• Marginal utility – The additional usefulness from consuming one more unit of a product.
• Marginal value –
• Market –
• Market basket –
• Market economy –
• Market failure –
• Market structure –
• Market system –
• Microeconomics –
• Monetary economics –
• Monetary policy –
• Monetary system –
• Money – Anything customarily used as a medium of exchange, a unit of accounting, and a store of value.
• Money supply –
• Monopolistic competition – Market situation in which a large number of sellers offer similar but slightly different products and in which each has some control over price.
• Monopoly –
• Monopsony –
• Mortgage –
• Motivation –
• Multipler –

N

• Nash equilibrium –
• National taxes – Taxes paid to the federal government for example income tax, tariffs, and social security taxes.
• National wealth – The total value of capital and private property that is owned within a country.
• Natural monopoly –
• Natural resource economics –
• Non-convexity –
• Non-price determinant of demand – A reason other than price, that changes the will to buy a good or a service, for example, fads, income, taste, future expectation, and population.
• Non-rivalry

O

• Oligopoly –
• Oligopsony –
• Opportunity cost –
• Organizational economics -

P

• Participation –
• Per capita – (usually at the end of an economic indicator) a unit of account per person.
• Perfect competition – A market structure in which a large number of firms all produce identical products.
• Personal property – Possessions such as jewelry, furniture, and real estate that people can amass through time.
• Physical capital – All human-made goods that are used to produce other goods and services; tools, machines, and buildings.
• Preference –
• Price – The amount of money it takes to buy a product or produce a product.
• Price ceiling – A government-regulated maximum price that can be legally charged for a good or service.
• Price elasticity of demand –
• Price elasticity of supply –
• Price floor – A government-regulated minimum price for a good or service.
• Price index –
• Price level –
• Prime rate –
• Producer surplus –
• Product differentiation –
• Production –
• Production set –
• Profit –
• Progressive tax – A tax schedule that states that the more income one earns, the higher the tax rate will be.
• Proportional tax – Also known as flat tax, it is a tax schedule that states that regardless of income, the same tax rate will be applied to all income earners.
• Proxemics –
• Public economics –
• Public good –
• Purchasing power parity –

Q

• Quantity theory of money –

R

• Rate of profit –
• Rational expectations –
• Real income effect – The change in consumption resulting from a change in income, adjusted for inflation.
• Real GDP – GDP that has been adjusted for inflation by applying the price deflator.
• Recession – Part of the business cycle in which the nation's output (real GDP) does not grow for at least six months.
• Regional science –
• Regressive tax – A tax schedule that states that the more one earns, the lower the tax burden.
• Regulation – Government restrictions on a business firm that usually helps consumers or the environment.
• Retail Sales – Purchases of finished goods and services by households and firms.
• Returns to scale –
• Revenue – Total income from sales of output.
• Rights –
• Right to work laws – State laws forbidding unions from forcing workers to join and pay union dues.
• Risk aversion –
• Rivalry –

S

• Saving –
• Scarcity –
• Shift work –
• Shortage –
• Social behavior –
• Social choice theory –
• Social mobility –
• Sociality –
• Stagflation – Simultaneous economic phenomenon where inflation and unemployment are both rising.
• State tax – Taxes paid to a state government for example sales taxes, state income tax, and license plate fees.
• Substitution effect – When consumers react to an increase in a good's price by consuming less of that good and more of other goods.
• Substitute good – A product that can satisfy the utility of another.
• Structural unemployment – Unemployment created due to the decrease in demand for the skills of a worker.
• Sunk costs –
• Supply – The amount of goods produced and available.
• Supply and demand –
• Supply chain –
• Supply curve – A graph of the quantity supplied of a good at different prices.
• Supply Schedule – A chart that lists how much of a good a supplier will offer at different prices.
• Supply shock – A sudden shortage of a good.
• System –

T

• Tax rate –
• Theory of the firm –
• Thermoeconomics –
• Total cost –
• Trade –
• Transaction cost –
• Trough –

U

• Underemployment – Working at a job for which one is overqualified, or working part-time when full-time work is desired.
• Unemployment – Underutilization of a factor of production, including labor.
• Uniform –
  is a type of clothing worn by members of an organization while participating in that organization's activity.
• Unit of account –
• Unitary elastic –
• Unskilled labor – Labor that requires no specialized skills, education, or training.
• Utility – Usefulness of a good or service in order to satisfy a need or a want.

V

• Variable cost –
• Velocity of money –

W

• Wealth effect –
• Willingness to accept –
• Willingness to pay –

Y

• Yield –

Z

• Zero-sum –

See also

• Economics