|
|
Elasticity of substitution |
|
|
|
 Home Site Map Add Term Search About Us Contributors |
Elasticity of substitutionThe elasticity of the ratio of two inputs to a production (or utility) function with respect to the ratio of their marginal products (or utilities). With competitive demands, this is also the elasticity with respect to their price ratio. For example, with factors L,K and factor prices w,r, the elasticity of substitution of a production function F(K,L) is s = (wL/rK)d(K/L)/d(w/r).Similar MatchesSubstitution effectSubstitution effectThat portion of the effect of price on quantity demanded that reflects the changed tradeoff between the good and other alternatives. Contrasts with income effect. No SubstitutionNo SubstitutionWithin the text on a proxy card are the words: "The shareholder appoints certain people (collectively, the proxy committee) with full power of substitution to vote the shares." If the security holder strikes out this phrase, the proxy cannot be voted if there is a change in the designated proxy committee. Same day substitutionSame day substitutionOffsetting changes in a margin account during the day that result in no overall change in the balance of the account. Import substitutionImport substitutionA strategy for economic development that replaces imports with domestic production. It may be motivated by the infant industry argument, or simply by the desire to mimic the industrial structure of advanced countries. Contrasts with export promotion. Asset substitutionAsset substitutionOccurs when a firm invests in assets that are riskier than those that the debtholders expected. Further SuggestionsSubstitution swapConstant elasticity of substitution function Marginal rate of substitution Import substitution development strategy |
|
|
|