Economics Dictionary of ArgumentsHome
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| Sensitivity analysis: Sensitivity analysis in economics assesses how changes in input variables (like prices, interest rates, or costs) affect outcomes in a model. It helps identify which assumptions have the greatest impact on results, aiding in decision-making under uncertainty. See also Elasticity, Price, Interest rates, Costs._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Kathleen Hogan on Sensitivity Analysis - Dictionary of Arguments
Krugman III 32 Sensitivity Analysis/cost sensitivity/international trade/Kala Krishna/ Kathleen Hogan/Phillip Swagel: Example: As Japanese costs rise, the optimal subsidy falls slightly, while the optimal tariff rises markedly, though it remains negative. Similarly, as U.S. costs rise, the optimal subsidy falls, while the optimal tariff remains relatively constant. >Optimal tariffs, >International trade, >Trade policies. This further reinforces the targeting interpretation given before. As Japanese firms' costs rise, their implied behavior becomes more competitive, thereby reducing the desirability of subsidizing imports. Similarly, as U.S. costs rise, implied U.S. firm behavior becomes more competitive, reducing the size of the domestic distortion targeted by the subsidy. Welfare function: Welfare at the optimum falls when US. costs rise, since the resource costs of production enter the welfare function directly. Welfare is relatively unaffected by Japanese costs, since these enter only via their impact on prices. Again, however, welfare falls, as higher costs mean higher prices. >Welfare function. Krugman III 34 Optimal policies: These sensitivity analyses imply that the calibration results and the optimal policies are quite insensitive to changes in the parameter values, with the exception of costs. Marginal costs, however, are the least reliable of our data. Kala Krishna, Kathleen Hogan, and Phillip Swagel. „The Nonoptimality of Optimal Trade Policies: The U.S. Automobile Industry Revisited, 1979-1985.“ In: Paul Krugman and Alasdair Smith (Eds.) 1994. Empirical Studies of Strategic Trade Policy. Chicago: The University of Chicago Press._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Hogan, Kathleen EconKrug I Paul Krugman Volkswirtschaftslehre Stuttgart 2017 EconKrug II Paul Krugman Robin Wells Microeconomics New York 2014 Krugman III Paul Krugman Alasdair Smith Empirical Studies of Strategic Trade Policy Chicago: The University of Chicago Press 1994 |
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