Archives: Terms

Definition of Dissaving Dissaving occurs when a personal, household, or national expenditure exceeds its income over a given period. In other words, when the total amount of money being spent is greater than the amount being earned or received, the difference is financed through savings or borrowing. This phenomenon indicates […]

Definition of Disposition Effect The disposition effect is a behavioral finance phenomenon that refers to the tendency of investors to sell assets that have increased in value while holding on to assets that have decreased in value. Essentially, it describes how investors are more prone to realize their gains too […]

Definition of Dispersed Knowledge Dispersed knowledge refers to the concept that information, insights, experiences, and understanding are spread widely among various individuals or groups within a society or an organization, rather than being concentrated in a specific location or among a few people. This decentralized form of knowledge encompasses a […]

Definition of Disequilibrium Macroeconomics Disequilibrium macroeconomics refers to a branch of economic theory that postulates that prices, wages, and rates of interest do not always adjust quickly enough to ensure equilibrium between supply and demand at all times. In other words, it challenges the classical view that markets are always […]

Definition of Discretionary Income Discretionary income is the amount of an individual’s income that is left for spending, investing, or saving after paying taxes and necessary living expenses. In other words, it is the income that a person can spend on non-essential items and services after they have fulfilled all […]

Definition of Discrete Choice Discrete choice refers to a decision-making process involving a selection among a finite number of choices. Unlike continuous choices, which can take on any value within a given range, discrete choices are limited to specific options. This concept is frequently applied in the field of economics […]

Definition of Discounting Discounting is an economic concept that refers to the process of determining the present value of a payment or a stream of payments that will be received in the future. Essentially, it’s about adjusting the future value of money to reflect its value in today’s terms. This […]

Definition of Diminishing Marginal Utility Diminishing Marginal Utility is a principle within the field of economics that describes the decrease in the added satisfaction a consumer gains from consuming one more unit of a good or service. Essentially, as individuals consume more of a good or service, the utility (or […]

Definition of Differentiated Bertrand Competition Differentiated Bertrand competition refers to a market structure in which firms sell products that are differentiated from one another, but compete primarily on price rather than on product features or quality. This form of competition is named after Joseph Bertrand, a French economist who suggested […]

Definition of the Diamond-Dybvig Model The Diamond-Dybvig model is a theoretical framework used in economics to describe the liquidity creation function of banks and the potential for bank runs. Developed by Douglas Diamond and Philip Dybvig in 1983, this model highlights how banks provide liquidity to depositors by pooling risk […]