What is Devaluation? Devaluation is a monetary policy tool used by countries to reduce the value of their currency by bringing a deliberate decline in…
Demand Shock: Definition, Meaning and Examples
A demand shock is an event that leads to a sudden increase or decrease in demand for a good or service. This can happen due…
Demand Theory – Definition, Law, Factors
Demand theory is the basic economic theory of demand and supply. It attempts to explain how prices and demand for goods are determined in a…
Classical Economics – Definition, Meaning, History and Examples
What is Classical Economics? Definition: Classical economics is a type of economics that focuses on economic growth and economic freedom by believing in free competition…
Demand Pull Inflation – Definition, Pros and Cons
Demand pull inflation is an economic theory that posits that inflation occurs when there is too much money chasing too few goods. The result is…
Helicopter Money – Definition, History, Examples and Criticism
Helicopter money is a term used to describe a situation where a central bank prints a large sum of new money and gives it directly…
Law of Diminishing Returns Explained
What are Diminishing Returns? Diminishing returns are the idea that the more you utilize something, the less value you get from it. Diminishing returns are…
What are Developing Countries?
What are Developing Countries? Development countries are those that have not yet reached “developed” status. The United Nations Department of Economic and Social Affairs defines…
Inelastic Demand – Definition, Types and Examples
What is Inelastic Demand? Inelastic demand is a situation in which demand for a good or service does not change very much in response to…
Demand Forecasting – Definition, Types and Examples
What is Demand Forecasting? Demand forecasting is the technique of estimating future consumer demand over a specified period based on past data and other information….
Development Economics – Definition, Types, Theories
What Is Development Economics? Development economics is a branch of economics that focuses on the economic aspects of the development process of developing countries. The…
Demand Function – Definition, Types, Formula, Examples
What is Demand Function? The demand function is an equation that showcases the demand for a product or service as a function of its price,…
Disinflation – Definition, Causes, Examples and Benefits
What is Disinflation? Disinflation is a reduction in the rate of inflation – or the pace at which prices are rising. It’s the opposite of…
Capitalism vs. Socialism – The differences between them
Understanding Capitalism vs. Socialism Capitalism vs socialism is an analysis of two opposing economic and political systems whose primary concerns revolve around economic equality and…
Disguised Unemployment – Definition, Overview and Types
What is Disguised Unemployment? Disguised unemployment is the underutilization of employees or workers based on their talents and skills. When there are a lot of…
Heavy Industry – Definition, Examples and Benefits
What is a Heavy Industry? Heavy industry is an industrial sector characterized by one or more features such as big and heavy products, large and…
Hard Money – Definition, Meaning, Examples, Pros and Cons
What is Hard Money? Hard money is a currency that is backed by a valuable commodity. The most common commodity backing hard money is gold…
Conflict Theory by Karl Marx – Definition, Overview and Examples
What is conflict theory? Conflict theory is a theory developed by Karl Marx that postulates that due to the world’s never-ending competition for finite resources,…
Headline Inflation – Meaning, Calculation and Difference from Core Inflation
Headline inflation is a measure of inflation that includes all items in the consumer price index (CPI), including food and energy prices. The headline inflation…
Closed Economy – Definition, Importance and Examples
A Closed Economy is a type of economy that does not have any trading activity with outside economies. A closed economy is an entirely self-sufficient…
Commodity Market – Definition, Examples and Types
A commodity market is a market that trades in the raw materials or primary economic sector rather than manufactured products. Agricultural products such as wheat,…
Circular Economy – Definition, Importance and Principles
A circular economy is a systemic way of developing an economy to benefit businesses as well as society and the environment. The circular economy development…
Collusion – Definition, Types and Examples
Collusion is an illegal secret agreement or collaboration between two parties designed to disrupt market stability. Collusion can take many forms, but typically involves some…
What is Happiness Economics?
Happiness economics is the study of how individuals’ well-being depends on economic factors. Happiness economists study how economic choices and policies affect people’s well-being. Happiness…
Communism – Definition, History and Examples
Communism is a political and economic system that promotes a classless society in which the means of production are communalized and private property is restricted…
Commodities – Definition, History and Types
Commodities are physical goods that are used in the production of other goods or services. Commodities are natural resources like oil, gas, gold, silver, wheat,…
Command Economy – Definition, Advantages and Disadvantages
A command economy is an economy in which the government has the power over the financial management of the country. This type of economy is…
Common-Pool Resources – Definition, Tips and Examples
A common-pool resource is a natural or man-made resource system where the size of the resource stock available to each user is determined by their…
Broad Money – Definition, Examples and Advantages
Broad money is the measurement of money moving around in an economy. It is the critical method used to calculate the money supply, including narrow…
Common Market – Definition, History and Examples
A common market is an economic integration scenario in which member countries’ trade barriers are reduced, and their external tariffs are uniform. It is a…
Capital Resource – Definition, Importance and Examples
A capital resource is a man-made asset that includes equipment, machinery, buildings, etc essential for channelizing the manufacturing process of products and services. It is…
Capital Flight – Definition, Types and Examples
Capital flight is a situation when businesses or investors eliminate their money from a country. This might be because of economic or political factors like…
Bureaucracy – Definition, Functions and Characteristics
Bureaucracy is a system that incorporates bureaucrats or the body of non-elected government officials and an administrative policy-making group to run a hierarchical organization or…
Economic Bubble – Definition, Types and Examples
An economic bubble is a financial situation in which the price of a good rises far above its real value. It occurs when prices exceed…
Black Economy – Definition, Types and Examples
The black economy is one of the segments of the economic activities of a country that fall outside of the commercial rules and regulations of…
Budget Deficit – Definition, Calculation and Types
A budget deficit is a situation when the expenses of a company or government spendings exceed the revenue. It occurs when expenditures surpass revenue. The…
Budget Surplus – Definition, Advantages and Disadvantages
A budget surplus is a situation in which revenue is more than spending or income is more than the expenses in a given period like…
Boom and Bust Cycle – Definition, Importance and Causes
The boom and bust cycle is a business cycle that covers alternating periods of growth and decline of an economy. In a boom period, the…
Consumer Products – Definition and 4 Types
Consumer products are the final goods that households or individuals purchase for their personal use and not for any other economic production activities. Consumer products…
Bartering – Definition, History, Benefits and Disadvantages
What is Bartering? Definition: Bartering is defined as an act of exchanging goods or/and services between two or more parties without using any monetary medium…
