Archives: Terms

Definition of the Compensation Principle The compensation principle is a concept in welfare economics that provides a criterion for evaluating the desirability of economic changes or policies. According to this principle, a change is considered to improve social welfare if those that benefit from the change could hypothetically compensate those […]

Definition of Compensation for Externalities Compensation for externalities refers to payments or other forms of remuneration designed to correct the social costs or benefits caused by externalities. An externality is a cost or benefit that affects a party who did not choose to incur that cost or benefit. They can […]

Definition of Compensating Wage Differential Compensating Wage Differential is the economic theory used to explain differences in wage rates due to the non-monetary characteristics of different jobs. It refers to the additional amount of income that a worker must be offered to motivate them to accept a job that is […]

Definition of Compensating Variation Compensating Variation (CV) is an economic concept that measures the amount of money that an individual would need to reach their original level of utility after a change in price or income. Essentially, it represents the monetary compensation required to keep an individual’s satisfaction constant despite […]

Definition of Compensated Demand Compensated demand refers to the concept in economics where the quantity demanded of a good changes as a result of a price change, but the consumer’s utility, or satisfaction, is kept constant through an adjustment in income. This theoretical construct allows economists to isolate the effect […]

Definition of Comparative Statics Comparative statics is a method used in economics to analyze the changes in a static (equilibrium) condition as a result of changes in external parameters. This approach helps in understanding how a shift in one or more parameters affects the outcome of economic models without having […]

Unfortunately, you did not provide a specific request or details for me to generate content on “comparative costs.” However, I can create a comprehensive English glossary post about “Comparative Advantage and Opportunity Cost,” which closely relates to the concept of comparative costs in economics. — Comparative Advantage and Opportunity Cost […]

Definition of Company Law Company law, also known as corporate law, is a branch of law that deals with the formation, governance, and dissolution of companies. It sets out the rights and obligations of shareholders, directors, employees, creditors, and other stakeholders involved in a company. This body of law governs […]

Definition of Company Director A company director is an individual elected or appointed to the board of directors of a company, tasked with the responsibility of governing and making strategic decisions for the company. Directors are entrusted with setting the company’s strategic direction, overseeing its management, and ensuring the company […]

Definition of Community Indifference Curve A Community Indifference Curve (CIC) represents the different combinations of two goods or services that provide the same level of satisfaction or utility to a community as a whole. This concept extends the idea of an individual’s indifference curve to the community or societal level, […]