Economics models

The AD-IA model builds on the concepts of the IS-LM model and the AD-AS models, essentially in terms of changing interest rates in response to fluctuations in inflation rather than as changes in the money supply in response to changes in the price level. ...more on Wikipedia about "AD-IA Model"

The backwardness model is a theory of economic growth created by Alexander Gerschenkron. The model postulates that the more backward an economy is at the outset of economic development, the more likely certain conditions are to occur. ...more on Wikipedia about "Backwardness"

Bertrand competition is a model of competition used in economics, named after Joseph Louis François Bertrand (1822-1900). Specifically, it is a model of price competition between duopoly firms which results in each charging the price that would be charged under perfect competition, known as marginal cost pricing. ...more on Wikipedia about "Bertrand competition"

The Big Push Model is a concept in development economics or welfare economics that emphasizes the fact that a firm's decision whether to industrialize or not depends on the expectation of what other firms will do. It assumes economies of scale and oligopolistic market structure. ...more on Wikipedia about "Big Push Model"

The circular flow of income, or simply the circular flow, is a simple economic model showing the relationship between money income and spending for the economy as a whole. The circle of money flowing through the economy – indicated by the green circle in the diagram – is as follows: total income is spent (with the exception of "leakages" such as consumer saving), while that expenditure allows the sale of goods and services, which in turn allows the payment of income (such as wages and salaries). Expenditure based on borrowings and existing wealth – i.e., "injections" such as fixed investment – can add to total spending. ...more on Wikipedia about "Circular flow of income"

In the classical general equilibrium model, the individual is assumed to be the basic unit of analysis and these individuals, both workers and employers, will make choices that reflect their unique tastes, objectives, and preferences. It is assumed that individuals' wants typically exceed their ability to satisfy them (hense scarcity of goods and time). It is further assumed that individuals will eventually experience diminishing marginal utility. Finally, wages and prices are assumed to be elastic (they move up and down freely). The classical model assumes that traditional supply and demand analysis is the best approach to understanding the labor market. The functions that follow are aggregate functions that can be thought of as the summation of all the individual participants in the market. ...more on Wikipedia about "Classical general equilibrium model"

The Cobweb model or Cobweb theory explains why prices in certain markets are subject to periodic fluctuation. It is an economic model of cyclical supply and demand in which there is a lag between response of producers to a change of price. Farming is a good example, as there is a lag between planting and harvesting. ...more on Wikipedia about "Cobweb model" Pure shortopedia. Pure Information Power.

Cournot competition is an economics model used to describe industry structure. It so called after Antoine Augustin Cournot (1801-1877) after he observed competition in a spring water duopoly. It has the following features: ...more on Wikipedia about "Cournot competition"

A discount function is used in economic models to describe the weights placed on rewards received at different points in time. For example, if time is discrete and utility is time-separable, with the discount function ...more on Wikipedia about "Discount function"

The Dual Sector model, or the Lewis model, is a model in Developmental economics that explains the growth of a developing economy in terms of a labor transition between two sectors, a traditional agricultural sector and a modern industrial sector. Initially enumerated in an article entitled "Economic Development with Unlimited Supplies of Labor" written in 1954 by Sir Arthur Lewis, the model itself was named in Lewis's honor. First published in The Manchester School in May 1954, the article and the subsequent model were instrumental in laying the foundation for the field of Developmental economics. The article itself has been characterized by some as the most influential contribution to the establishment of the discipline. ...more on Wikipedia about "Dual Sector model"

In an economic model, an endogenous change is one that comes from inside the model and is explained by the model itself. For example, in the simple supply and demand model, suppose that there is a change in consumer tastes or preferences (an exogenous change). This leads to endogenous changes in demand and thus the equilibrium price and quantity. ...more on Wikipedia about "Endogeneity (economics)"

Exogenous growth model, also known as the Neo-classical model or Solow growth model is a term used to sum up the contributions of various authors to a model of long-run economic growth within the framework of neoclassical economics. ...more on Wikipedia about "Exogenous growth model"

The term German model is most often used in economics to describe post- World War II West Germany's means of using (according to University College London Professor Wendy Carlin) innovative industrial relations, vocational training, and closer relationships between the financial and industrial sectors to cultivate economic prosperity. ...more on Wikipedia about "German model"

In economics, the guns versus butter model is the classic example of the production possibility frontier. It models the relationship between a nation's investment in defense and civilian goods. In this model, a nation has to choose between two options when spending its finite resources. It can buy either guns or butter, or a combination of both. This can be seen as an analogy for choices between defense and civilian spending in more complex economies. ...more on Wikipedia about "Guns versus butter model"

The Harris-Todaro Model is an economic model used in development economics and welfare economics to explain some of the issues concerning rural-urban migration. The main result of the model is that the migration decision is based on expected income differentials between rural and urban areas, not wage differentials. This implies that rural-urban migration in a context of high urban unemployment can be economically rational if expected urban income exceeds expected rural income. ...more on Wikipedia about "Harris-Todaro Model"

The Harrod-Domar model is used in development economics to explain an economy's growth rate in terms of the level of saving and productivity of capital. It suggests there is no natural reason for an economy to have balanced growth. The model was developed independently by Sir Roy F. Harrod in 1939 and Evsey Domar soon afterwards. The Harrod-Domar model was the precursor to the Exogenous growth model. ...more on Wikipedia about "Harrod-Domar model"

The Heckscher-Ohlin model (H-O model) is a general equilibrium mathematical model of international trade, developed by Eli Heckscher and Bertil Ohlin at the Stockholm School of Economics. It builds on David Ricardo's theory of comparative advantage by predicting patterns of trade and production based on the factor endowments of a trading region. ...more on Wikipedia about "Heckscher-Ohlin model"

Homo economicus, or Economic man, is the concept in some economic theories of man as a rational and " self-interested" actor. ...more on Wikipedia about "Homo economicus"

An input-output model is widely used in economic forecasting to predict flows between sectors. ...more on Wikipedia about "Input-output model"

The IS/LM model, first developed by Sir John Hicks and Alvin Hansen, has been used from 1937 onwards to summarize a major part of Keynesian macroeconomics. It can be presented as a graph of two intersecting lines in the first quadrant. ...more on Wikipedia about "IS/LM model"

In economic theory, the Lange-Lerner-Taylor theorem states that an economy in which all production is performed by the state, but in which there is a functioning price mechanism, has similar properties to a market economy under perfect competition, in that it achieves Pareto efficiency. ...more on Wikipedia about "Lange-Lerner-Taylor theorem"

A location (spatial) model refers to any monopolistic competition model in economics that demonstrates consumer preference for particular brands of goods and their locations. Examples of location models include Hotelling’s Location Model, Salop’s Circle Model, and hybrid variations. ...more on Wikipedia about "Location model"

In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and quantitative relationships between them. As in other fields, models are simplified frameworks designed to illuminate complex processes. ...more on Wikipedia about "Model (economics)"

In economics, the Mundell-Fleming model is an extension of the IS-LM model. Whereas IS-LM deals with economy under autarky, the Mundell-Fleming model tries to describe a small open economy. ...more on Wikipedia about "Mundell-Fleming model"

An overlapping generations model, abbreviated to OLG model, is a type of economic model in which agents live a finite length of time and live long enough to endure into at least one period of the next generation's lives. ...more on Wikipedia about "Overlapping generations model"

This article is licensed under the GNU Free Documentation License.
It uses material from the Wikipedia . Direct links to the original articles are in the text.
If you use exact copy or modified of this article you should preserve above paragraph and put also : It uses material from the Shortopedia article about "Economics models".

MAIN PAGE MAIN INDEX CONTACT US