How to calculate what the investment multiplier is. The meaning of accelerator (in economics) in the Great Soviet Encyclopedia, BSE Accelerator is a relation

One of the first to pay serious attention to the effect of the investment accelerator was the American economist John Maurice Clark, who actively studied the problems of economic cycles. Clark believed that an increase in demand for consumer goods creates a chain reaction leading to multiple increases in the demand for equipment and machinery. To understand the effect of an investment accelerator, the capital intensity ratio is used. At the macroeconomic level, the capital intensity ratio is expressed by the capital-income ratio.

When considering the principle of acceleration, we are primarily interested in pure investment. Net investment cannot be of any size. Since gross investment on the scale of the national economy cannot take negative values, the maximum limit that negative net investment can reach is the amount of depreciation.

When constructing an investment accelerator model, economists proceed from a certain lag (time lag) in the reaction of economic agents making investments to an increase in sales or real GDP growth. Even if an entrepreneur is extremely quick to react, he will first sell off stocks of finished products, calculate various options for investment projects, and only then make investments.

The multiplier begins to work almost immediately as soon as primary (autonomous) investments are made at least in some points of the market economy, because at these points production begins to expand, the demand for investment goods increases and wages rise, and then the demand for consumer goods increases.

The multiplier is a multiplier showing the excess of the increase in national income over the increase in initial autonomous investments in some specific firms.

In other words, the increase in national income is equal to the increase in the product of the initial investment and the multiplier.

The multiplier increases the growth of national income because the primary investments of some specific firms increase the demand first for investment goods that other firms must produce, and then the demand for consumer goods. All this will be transferred to other companies through technological chains. Unemployment will decrease and demand for consumer goods will increase.

The multiplier begins to operate in the economy not immediately, but gradually, while the effects of the multiplier are layered on top of each other and the total cumulative effect of the multiplier, which usually stretches in the economy for one and a half to two years, depends on this. And then the multiplier seems to fade away, its effect ends, but only when the entire national income goes into savings. But there is another point of view. The fact is that the multiplier ceases to operate when the entire national income is equal to the increase in savings in absolutely liquid form.

Accelerator is a coefficient showing how much investments increase as income grows.

Autonomous investments cause, with increasing income, stimulated investments (derivative investments), depending on the dynamics of income. This is called the accelerator effect. But the accelerator “wheel” can turn in the other direction. A reduction in income will also reduce derivative investments, and this will lead to economic stagnation.

The concept of an accelerator was first formulated by the French economist A. Aftalion in 1919. It was later developed by J. Clark, J. Tinbergen, S. Kuznets, and P. Samuelson.

Accelerator formula

The accelerator formula in a simplified form can be presented as the ratio of investments of a given year to the increase in income of the previous year.

a=I t /V t -V t-1

where a is the acceleration coefficient.

From this formula it follows that investments in period t are a biased response to changes in income in the previous period:

I t =a*(V t -V t-1)

An increase in income, other things being equal, will cause a larger increase in investment in the subsequent period, and a decrease in income will cause a multiple reduction in investment. The accelerator effect is closely related to the multiplier effect. Together they form an animation-acceleration mechanism.

The discovery of these principles made it possible to understand the mechanism of economic growth and its fluctuations.

Sufficiently regular autonomous investment will cause long-term sustainable economic growth if the propensity to save, the accelerator, and the capital productivity coefficient do not change.

If autonomous investment does not regularly “fuel” economic growth, the marginal propensity to consume increases, and the marginal propensity to save falls. A decrease in investment will cause a drop in income.

This will lead to a further decrease in savings and investment - growth will be replaced by economic decline. This will happen until autonomous investments give impetus to economic growth. Thus, the multiplication-acceleration mechanism can be represented as a spiral that either unfolds or collapses, causing cyclical fluctuations in the economy.

The speed shift levers, accelerators, starter button, and choke opening handle are located very low above the platform level (Fig. 12). It is known that the distance from the floor to the end of the fingers of the lowered hand is normal

There are methodological difficulties. An example is the provisions of the neo-Keynesian growth theory, according to which the rate of production growth is a function of accumulation in national income and the efficiency of this accumulation. But to determine the efficiency of accumulation, it is necessary to determine the effect of the multiplier and accelerator, and therefore distinguish between investments into autonomous and induced. In conditions of uncertainty caused by the unpredictability of the behavior of the private sector, the possibility of solving this problem is problematic, especially if we take into account the fact that the coefficients of capital intensity and material intensity, which affect the structure of production, change over time.

ACCELERATOR is an indicator used in government regulation of a market economy. The acceleration principle assumes that increases or decreases in consumer spending cause changes in capital formation. For example, a significant increase in consumer demand for goods may result in an increase in production capacity. On the contrary, a significant reduction in consumer spending can reduce manufacturers' profits so much that it will not even allow them to replace worn-out equipment, i.e., it will cause some kind of reduction in investment. The acceleration coefficient (accelerator) characterizes the change in the volume of investments caused by an increase or decrease in consumer spending. In the practice of regulating the Soviet economy, the principle of acceleration is not yet actually implemented.

This relationship is stable and is characterized by a multiplier and an accelerator.

Accelerator - the dependence of the growth of investments on the growth of national income (or GNP).

Samuelson and Hicks believe that combining the accelerator principle with a multiplier can recreate the same cycle as in real life.

Suppose the economy is moving towards full employment, GNP increases, sales of products are carried out at an increasing pace. Then, according to the accelerator principle, an increase in product sales leads to a high level of investment. And thanks to the multiplier, increasing the level of investment contributes to further growth of GNP. The economy in this case is in a boom phase. The opposite situation is possible.

Animator model. The role of the accelerator in the economy. The paradox of thrift.

Multiplier-accelerator model

It is mathematically proven that this equation has a characteristic form and roots (A-i and Xr), as well as a general solution. Depending on the value of the investment coefficient (accelerator V), four types of economic dynamics are derived from the Samuelson-Hicks model (see Table 5.2).

Types of dynamics depending on the accelerator value in the Samuelson-Hicks business cycle model

What is the meaning of the multiplier-accelerator mechanism?

Give a mathematical expression for the accelerator principle.

Multiplier-accelerator model

But the most unpleasant news was in the letter that he now held in his hands. It was a notice that he and his Safari Country were being sued for negligence. He remembered the Burtons. One day last summer they were driving through the park. There were signs along the entire path warning that it was dangerous to open car windows, but one of Burton’s children still lowered the window and threw a sandwich out the window. One of the lions (Probably the one that hunts zebras, Thompson suddenly thought) swallowed a sandwich and jumped onto the roof of the stopped car, apparently asking for more. Burton, in a panic, sharply pressed the accelerator, lost control, the car drove off the path and crashed into a nearby tree. Although the family members escaped with scratches, the car was smashed to pieces. In the case that Burton brought, he demanded compensation in the amount of 3 million dollars, 10 thousand for a broken car and 2 million 990 thousand for moral damages.

Thus, we practically did not have correct cycles. The only exception is the large cycle of economic conditions, which took place according to the calculations of V. Shekhin, in 1929-1932-1981 - 1985. Along with the development of market processes, the nature of recessions will gradually change; they will begin to play the role of a qualitative structural factor in the renewal of fixed capital. Apparently, it will also be possible to use the ideas of the multiplication effect and the accelerator principle.

Accelerator is a coefficient showing how much investments increase as income grows.

The concept of an accelerator was first formulated by the French economist A. Aftalion in 1919. It was later developed by J. Clark, J. Tinbergen, S. Kuznets, and P. Samuelson.

Accelerator formula

The accelerator formula in a simplified form can be presented as the ratio of investments of a given year to the increase in income of the previous year.

a=I t /V t -V t-1

where a is the acceleration coefficient.

From this formula it follows that investments in period t are a biased response to changes in income in the previous period:

I t =a*(V t -V t-1)

The discovery of these principles made it possible to understand the mechanism of economic growth and its fluctuations.

Sufficiently regular autonomous investment will cause long-term sustainable economic growth if the propensity to save, the accelerator, and the capital productivity coefficient do not change.

an indicator calculated as the ratio of the increase in investment to the relative increase in income, consumer demand or finished products (production volume) that caused it.

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Accelerator

Accelerator is an indicator of changes in the required volume of investment when consumer demand for products changes.

Multipliers and accelerators are used in the analysis of - economic cycles; and - the role of capital investment in the uneven development of the economy.

Excellent definition

Incomplete definition ↓

Accelerator

lat. accelero acceleration), an economic indicator that is used in government regulation of a market economy. The acceleration coefficient characterizes the change in investment volume caused by an increase or decrease in consumer spending. The essence of the acceleration principle is to identify the relationship between the demand for means of production and the demand for consumer goods, in which the demand for means of production grows faster than for consumer goods.

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ACCELERATOR

1) an indicator used in government regulation of a market economy. The acceleration principle assumes that increases or decreases in consumer spending cause changes in capital accumulation; 2) an equation establishing the dependence of an endogenous variable on the growth (rate of change) of an exogenous variable. Used in dynamic macroeconomic models to reflect the dependence of capital investments on changes in the final product. The concept was proposed by J.M. Keynes.

Excellent definition

Incomplete definition ↓

Accelerator

an indicator used in government regulation of a market economy. The acceleration principle assumes that increases or decreases in consumer spending cause changes in capital accumulation. For example, a significant increase in consumer demand for goods may result in an increase in production capacity. On the contrary, a significant reduction in consumer spending can reduce manufacturers' profits so much that they will not even be able to replace worn-out equipment, i.e. will cause one or another reduction in investment. The acceleration coefficient (accelerator) characterizes the change in the volume of investments caused by an increase or decrease in consumer spending. In the practice of regulating the Russian economy, the principle of acceleration is not yet actually implemented.

Excellent definition

Incomplete definition ↓

ACCELERATOR

(accelerator) An indicator that establishes the dependence of the volume of investment (investment) on changes in the volume of output (output). The accelerator model states that firms invest more when output increases and less when output decreases. This assumption seems reasonable: an increase in demand encourages some firms to produce more and gives them and other firms the hope that demand will continue to increase. An increase in output raises the relationship between output and capacity, and the expectation of a further increase in demand causes firms to assume that they will benefit from holding additional capital equipment. Accelerator-type models help empirically explain both fluctuations in fixed investment and changes in investment in inventories and work in progress.

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Incomplete definition ↓

ACCELERATOR

English accelerator) – 1) in the most general sense, the term of economic cybernetics: such a link in the control system (“differentiating link”) in which the output value is proportional to the rate of change of the input value, i.e. y = k(dx/dt); 2) in the theory of economic growth - an indicator characterizing the relationship between the increase in national income (or final product) and the volume of capital investment and reflecting the so-called. effect of increasing development (acceleration); 3) the same interpretation of this concept in the works of representatives of neo-Keynesianism - as an indicator reflecting only one side of this relationship: the influence of the expected or required growth of national income (product volume or demand for these products) on the size of capital investments induced (caused) by it. It is the latter interpretation that is most common in Western countries. economical lit-re. The meaning of the “acceleration effect” is the greater the share of national income allocated for capital investment, the faster the national economy itself grows. income, the larger share of it can be allocated to new capital investments, etc. Coefficient k (power or factor A.) is obtained by dividing the amount of capital investment K in a given year by the increase in national income. income (final product) in the previous year (in other words, this is the amount of capital investments associated with an increase in a unit of income): The inequality k>1 is usually true, since the cost of means of production is always significantly higher than the cost of the products they produce during the year. If the absolute volume of capital investment for a given year is known, with the help of A. one can determine the approximate value of the increase in national income. income (or final product) next year: And vice versa, if the goal is to obtain a certain increase in national income (or final product), knowing the coefficient A., determine the required amount of capital investment (i.e., increase in funds): For example, to increase production output next year by 20 million rubles. with an acceleration coefficient of 3, you will have to spend 60 million rubles. capital investments, and with k = 4 – 80 million rubles. These will, however, not be all required investments, but only induced ones. This will not include, for example, the costs of restoring retiring assets and autonomous capital investments (component b). Together with the multiplier, A. puts into the hands of the researcher important tools for building dynamic. economic models. In particular, the interaction between A. and the multiplier is the basis of the economic model. Harrod–Domar growth. In relation to dept. For a company, econometrics interprets the acceleration coefficient k as an optimal indicator of the capital intensity of changes in the scale of economic activity. activities (for example, expanding the production of certain products). It can be either constant or variable - when, with the growth of production, the level of its economic efficiency also changes (economy of scale, effect of changes in production technology). In addition to the described model of simple architecture, which takes into account only the relationship between the growth of results (income or output) and the capital investments necessary for it or caused by it, there is a flexible architecture - a model that takes into account, in particular, complementary growth. circumstances (for example, the possibility of production growth without capital investment, if there are idle capacities, fluctuations in the level of production, etc.), as well as A. with a lag - a model that takes into account the lag of the actual. the rate of investment growth in relation to the growth of production results (income), which causes them.