Archives: Terms

Definition of the Arrow Information Paradox The Arrow Information Paradox, named after economist Kenneth Arrow, revolves around a fundamental dilemma in the economics of information. The paradox highlights a contradiction related to buying and selling information. It suggests that the actual value of information cannot be determined until after it […]

Definition of Arrow-Debreu Security An Arrow-Debreu security (also known as a pure security or a state-contingent claim) is a theoretical concept in financial economics that represents a financial asset which pays off one unit of utility if a particular state of the world occurs, and zero in all other states. […]

Definition of Arrow–Debreu Model The Arrow–Debreu model, named after economists Kenneth Arrow and Gerard Debreu, is a theoretical framework for understanding the workings of a complete market system. It’s a model of general equilibrium in which prices for all goods and services in the economy are determined such that supply […]

Definition of Arbitrage Arbitrage is a trading strategy that involves buying a financial instrument or commodity in one market and simultaneously selling it in another market at a higher price. This difference in prices allows the arbitrager to make a profit on the spread between the two markets. Arbitrage opportunities […]

Definition of Appropriate Technology Appropriate technology refers to technology that is designed with special consideration to the environmental, ethical, cultural, social, political, and economic aspects of the community it is intended for. This term is often associated with the practices and innovations in sustainable development and aims to address the […]

Definition of Antitrust Law Antitrust laws, also known as competition laws, are statutes developed to protect consumers from predatory business practices and ensure a level playing field for all competitors. These laws prevent monopolies, promote competition, and facilitate the free flow of goods and services in the market. The essence […]

Definition of Anti-Rival Good An anti-rival good is a type of good that increases in value as more people use it. Unlike rival goods, which can only be used or consumed by one person at a time, anti-rival goods become more beneficial the more they are shared. This characteristic is […]

Definition of Annual Effective Discount Rate The Annual Effective Discount Rate (AEDR) is a financial metric used to compare the profitability or cost of different financial instruments, taking into account the effects of compounding over a one-year period. Unlike the annual effective interest rate that refers to the amount of […]

Definition of the Anglo-Saxon Model The Anglo-Saxon model, often referred to as the Anglo-Saxon economy, is a capitalist model that emphasizes free markets, minimal government intervention in the economy, and the importance of the private sector in creating wealth. This model is most closely associated with English-speaking countries such as […]

Definition of the Amoroso-Robinson Relation The Amoroso-Robinson relation is a fundamental concept in economics that describes how the optimal price charged by a firm in a market can be determined. It relies on the understanding of the marginal revenue (the additional revenue from selling one more unit of a product) […]