Glossary of Economics Terms

7/29/2019 Glossary of Economics Terms

http://slidepdf.com/reader/full/glossary-of-economics-terms 1/23

Универзитет “Св. Кирил и Методиј”Филолошки факултет “Блаже Конески”

Семинарска работа по:

Терминологија

Изработил: Ментор:

Божинов Стево Мургоски ЗозеСкопје 2007



Термини од економска област



Содржина:Прва страна...................................................................................................................1Наслов на семинарската...............................................................................................2Содржина......................................................................................................................3Вовед..............................................................................................................................4

A Fortiori Pricing, Ability To Pay Principle In Taxation, Abnormal Return, AbsoluteRisk Aversion, Absorptive Capacity, Abstracting From, Accelerator Principle,Acceptance Region…………………………………………………………………….5Adapted, Active Measures, Adverse Selection, Affiliated, Affine, AGI, AFQT,Aggregate Demand, Affine Pricing……………………………………………………6Aggregate Supply, Akaike’s Information Criterion, Alienation, Almost Surely,Annihilator Operator, Analytic, Alternative Hypothesis………………………………7Americanist, Annuity, Annuity Formula, Anti- Trust Legislation, ANOVA, ARCH,Arbitrage Opportunity, Arbitrage Pricing Theory, AR(1)…………………………….8ARIMA, Asset Pricing Functions, Arrovian Uncertainty, Arrow- Debreu Equilibrium,Arrow- Pratt Measure, ARMA………………………………………………………...9

Asymptotically Unbiased, Asymptotic, Asymptotic Normality, Asymptotic Variance,Asymptotically Equivalent, Asset Pricing Models…………………………………..10Attractor, Autoregressive, Austrian Economics, Autarky, Autocorrelation,Autocovariance, Autocovariance Matrix, Augmented Dickey- Fuller Test…………11Avar, Average Propensity To Consume, Average Propensity To Save, Average TotalCost, B1, Bads, Balance Of Payments, Balanced Budget, Balanced Growth, BanachSpace…………………………………………………………………………………13Bellman Equation, Bertrand Competition, Bertrand Duopoly, Bertrand Game,Beveridge Curve, BHHH, Bias, Bidding Function, Bill Of Exchange……………....14Billon, Bimetallism, Black- Scholes Equation, Blue Chip, Bond, Bond Rating,Bonferroni Criterion………………………………………………………………….15Bootstrapping Criterion, Borel Set, Borel- Sigma Algebra, Bounded Rationality, Box-Cox Transformation………………………………………………………………….16Box- Jenkins, Brent Method, Bretton- Woods System, Breusch- Pagan Statistic,Bubbles……………………………………………………………………………….17Budget, Budget Line, Budget Set, Bull Market, Bureaucracy, Burr Distribution,Business Cycle Frequency, Buyer’s Market…………………………………………18Calculus Of Voting, Calibration, Call Options, Capital, Capital Consumption, CapitalDeepening…………………………………………………………………………….19Capital Intensity, Capital Ratio, Capital Structure, Capital- Augmenting, Capitation,Cash-in-advance Constraint, Cartels, Cauchy Distribution…………………………..20

CDF, Censored Dependent Variables, Certainty Equivalence Principle, CensoredLeast Absolute Deviations, Central Banks, Center for Research in Security Prices…21Certainty Equivalent, Ceteris Paribus, CES Technology, CES Utility, CES ProductionFunction……………………………………………………………………………....22Користена литература................................................................................................23



Вовед:

Под поимот стопански систем се подразбира една поконкретна состојбаво рамките на еден економски систем и ги покажува условите одредени од

страна на државата под кои се одвива стопанската активност. Стопанскиотсистем на една земја всушност ги содржи правилата, условите во коистопанските субјекти, како што се претпријатијата, фирмите, банките,државните органи, установите, менаџерите, службениците, работниците идругите субјекти ја остваруваат својата стопанска активност. Тоа еинституционална рамка во која претпријатијата, службите и граѓаните работат,односно купуваат, продаваат, произведуваат, трошат, плаќаат и наплатуваат,увезуваат или извезуваат, користат или даваат кредити, емитуваат или купуваатакции, користат или даваат образовни или здравствени услуги и сл.

Сите овие активности се секојдневни и се одвиваат во огромен број.Затоа и е неоходно тие на определен начин и да бидат регулирани. Затоа, денес

во сите држави има, со закон определен, паричен систем, правила за банкарско,пазарно работење и организирање итн. Основните елементи на секој стопанскисистем се:

-сопственичките односи. Во РМ со Уставот и законите се утврденисопственичките односи, се гарантира неприкосновеноста на правото насопственост.

-организацијата и упавувањето со фирмите. Искуството на многу земјиима покажано дека и покрај големата слобода на фирмите во изборот наформите на организација и управување, сепак е потребно да постојат и да сеприменуваат некои општи правила. Притоа, многу е важно со таквите правилада не се згрозува автономноста, самостојноста на фирмите.

-пазарното работење. Овде се регулираат правилата на конкуренција напазарот, се регулираат и монополите, улогата на државата при нејзинотомешање во пазарните односи, слободите и ограничувањата на фирмите вопазарните односи и сл.

-работните односи. Односите меѓу работниците, работодавачите,сопствениците, начинот на кој тие односи се регулирани итн.

-улогата на државата во регулирањето на стопанската практика. Ова сесмета за најважен елемент и улогата на овој елемент е да се сведе мешањето надржавата во пазарот на оптимално ниво.

Имајќи ги предвид овие основни елементи државата всушност ги

определува одделните составни делови, а тоа се потсистемите на стопанскиотсистем. Токму тие потсистеми ја чинат содржината на стопанскиот систем и тиесе предмет на изучување во економиката. Такви се на пример: фискалниотсистем, што ги опфаќа правилата за оданочување, за банкарско- кредитниотсистем, правилата за функционирање на пазарот на пари, девизниот пазар итн.



AA Fortiori Pricing- Latin for "even stronger". Can be used to compare two theoremsor proofs. Could be interpreted to mean "in the same way." Принципот Фортиори.

Ability To Pay Principle In Taxation- The widely held view that the amount of

taxes someone pays should increase as their income increases. Непосредни,

Директни, Прогресивни даноци.

Abnormal Returns- Used in the context of stock returns; abnormal returns meansthe return to a portfolio in excess of the return to a market portfolio. Contrast excessreturns which means something else. Note that abnormal returns can be negative.Example: Suppose average market return to a stock was 10% for some calendar year,

meaning stocks overall were 10% higher at the end of the year than at the beginning,and suppose that stock S had risen 12% in that period. Then stock S's abnormal returnwas 2%. Дополнителни враќања. Се што е плус од просечното пазарно

портфолио за одреден пресметковен период (најчесто една година).

Absolute Risk Aversion- Absolute risk aversion is an attribute of a utility function.Намалување, исклучување на ризикот.

Absorptive Capacity- Absorptive capacity is a limit to the rate or quantity of scientific or technological information that a firm can absorb. If such limits exist they

provide one explanation for firms to develop internal R&D capacities. R&Ddepartments can not only conduct development along lines they are already familiar with, but they have formal training and external professional connections that make it

possible for them to evaluate and incorporate externally generated technicalknowledge into the firm better than others in the firm can. In other words a partialexplanation for R&D investments by firms is to work around the absorptive capacityconstraint. Апсорбирачки капацитет на научни податоци на едно

претпријатие.

Abstracting From- Abstracting from is a phrase that generally means "leaving out".A model abstracts from some elements of the real world in its demonstration of some

specific force. Апстинирање, изоставање.

Accelerator Principle- The accelerator principle is the growth of output that inducescontinuing net investment. That is, net investment is a function of the change inoutput not its level. Принцип на раст (со растот на производството се

зголемуваат и финансиските средства наменети за инвестиции).

Acceptance Region- The acceptance region occurs in the context of hypothesistesting. Let T be a test statistic. Possible values of T can be divided into two regions,the acceptance region and the rejection region. If the value of T comes out to be in theacceptance region, the null hypothesis being tested is not rejected. If T falls in the

rejection region, the null hypothesis is rejected. Дел за прифаќање (од вредностана одредена променлива).



Active Measures- In the context of combating unemployment: active measures are policies designed to improve the access of the unemployed to the labour market and jobs, job-related skills, and the functioning of the labour market. Contrast passivemeasures. Активни мерки (што се превземаат за да се намали

невработеноста).

Adapted- The stochastic process {Xt} and information sets {Yt} are adapted if {Xt} isa martingale difference sequence with respect to {Y t}.

Adverse Selection- in a market where buyers cannot accurately gauge the quality of the product that they are buying, it is likely that the marketplace will contain generally

poor quality products. Adverse selection was first noted by Nobel Laureate GeorgeAkerlof in 1970. Неповолен избор (на пазар каде што поради неможноста да

се процени квалитетот на стоката, се купува неквалитетна стока).

Affiliated- Bidders' valuations of a good being auctioned are affiliated if, roughly:&quot a high value of one bidder's estimate makes high values of the others' estimatesmore likely.&quot. There may well be good reasons not to use the word correlated in

place of affiliated. This editor is advised that there is some mathematical difference.

Affine- Affine is an adjective, describing a function with a constant slope.Distinguished from linear which sometimes is meant to imply that the function has noconstant term; that it is zero when the independent variables are zero. An affinefunction may have a nonzero value when the independent variables are zero.Examples: y = 2x is linear in x, whereas y = 2x + 7 is an affine function of x.And y = 2x + z2 is affine in x but not in z. Придавка за функција со постојана

опаѓачка вредност.

Affine Pricing- Affine pricing is a pricing schedule where there is a fixed cost or benefit to the consumer for buying more than zero, and a constant per-unit cost per unit beyond that. Formally, the mapping from quantity purchased to total price is anaffine function of quantity. Using, mostly, Tirole's notation, let q be the quantity inunits purchased, T(q) be the total price paid, p be a constant price per unit, and k bethe fixed cost, an example of an affine price schedule is T(q)=k+pq. Принципот

Афин (Принцип за одредување цени на производи во зависност од

количината во која се купуваат).

AFQT- AFQT is short for the Armed Forces Qualifications Test -- a test given to newrecruits in the U.S. armed forces. Results from this test are used in regressions of labour market outcomes on possible causes of those outcomes, to control for other causes. Квалификационен тест на вооружените сили.

Aggregate Demand- Aggregate demand is the sum of all demand in an economy.This can be computed by adding the expenditure on consumer goods and services,investment, and not exports (total exports minus total imports). Вкупна

побарувачка (на ниво на стопанство).

AGI- AGI is an abbreviation for Adjusted Gross Income, a line item which appearson the U.S. taxpayer's tax return and is sometimes used as a measure of income which



is consistent across taxpayers. AGI does not include any accounting for deductionsfrom income that reduce the tax due, e.g. for family size. Прилагоден бруто

приход.

Aggregate Supply- Aggregate supply is the total value of the goods and services

produced in a country, plus the value of imported goods less the value of exports.Вкупна понуда.

Akaike’s Information Criterion- Akaike's Information Criterion is a criterion for selecting among nested econometric models. The AIC is a number associated witheach model:

AIC=ln (sm2) + 2m/T

where m is the number of parameters in the model, and sm2 is (in an AR(m) example)

the estimated residual variance: sm2 = (sum of squared residuals for model m)/T. That

is, the average squared residual for model m.The criterion may be minimized over choices of m to form a trade off between the fitof the model (which lowers the sum of squared residuals) and the model's complexity,which is measured by m. Thus an AR(m) model versus an AR(m+1) can be compared

by this criterion for a given batch of data.

An equivalent formulation is this one: AIC=T ln(RSS) + 2K where K is the number of regressors, T the number of obserations, and RSS the residual sum of squares;minimize over K to pick K. Информативниот критериум на Акаике.

Alienation- Alienation is a Marxist term. Alienation is the subjugation of people bythe artificial creations of people "which have assumed the guise of independentthings." Because products are thought of as commodities with money prices, thesocial process of trade and exchange becomes driven by forces operatingindependently of human will like natural laws. Оттуѓување, осамостојување,

алиенација.

Almost Surely- Almost surely is with probability one. In particular, the statement thata series {Wn} limits to W as n goes to infinity, means that Pr{Wn->W}=1Приближна вредност на 1.

Alternative Hypothesis- Alternative hypothesis is the "hypothesis that the restrictionor set of restrictions to be tested does NOT hold." Often denoted H 1. Synonym for 'maintained hypothesis.

Analytic- Analytic often means 'algebraic', as opposed to 'numeric'. E.g., in thecontext of taking a derivative, which could sometimes be calculated numerically on acomputer, but is usually done analytically by finding an algebraic expression for thederivative. Аналитички (често се користи наместо “алгебарски”, што значи

спротивно од нумерички).

Annihilator Operator- The annihilator operator is denoted []+ with a lag operator

polynomial in the brackets. Has the effect of removing the terms with an L to a



negative power; that is, future values in the expression. Their expected value isassumed to be zero by whoever applies the operator.

Americanist- An Americanist is a member of a certain subfield of political science.Американист.

Annuity- An annuity is an asset that pays a constant amount each year to the holder until the annuity expires and/or the holder of the annuity passes away. Годишна

исплата, ануитет

Annuity Formula- If annuity payments over time are (0,P,P,...P) for n periods, andthe constant interest rate r>0, then the net present value to the recipient of the annuitycan be calculated by the annuity formula:

NPV(A) = (1-(1+r)-n)P/r Формула за пресметување годишна исплата, ануитет.

Anti- Trust Legislation- Anti-trust legislation is legislation designed to break upexisting monopolies and prevent the formation of new monopolies to increasecompetition and societal welfare. Законска регулатива за созбивање монополи.

ANOVA- ANOVA stands for analysis-of-variance, a statistical model meant toanalyze data. Generally the variables in an ANOVA analysis are categorical, notcontinuous. The term main effect is used in the ANOVA context. The main effect of x

seems to mean the result of an F test to see if the different categories of x have anydetectable effect on the dependent variable on average. ANOVA is used often insociology, but rarely in economics as far as this editor can tell. The terms ANCOVA

and ANOCOVA mean analysis-of-covariance. Анализа на разновидност,варијантност.

AR(1)- AR(1) is a first-order autoregressive process. Авторегресивен процес.

Arbitrage Opportunity- An arbitrage opportunity is the opportunity to buy an assetat a low price then immediately selling it on a different market for a higher price.Арбитражна можност (купување стока за да се препродаде по повисока

цена).

Arbitrage Pricing Theory- APT is short for Arbitrage Pricing Theory; from Stephen

Ross, 1976-78. Quoting Sargent, "Ross posited a particular statistical process for assetreturns, then derived the restrictions on the process that are implied by the hypothesisthat there exist no arbitrage possibilities." Арбитражна теорија за одредување

цени.

ARCH- ARCH stands for Autoregressive Conditional Heteroskedasticity. It is atechnique used in finance to model asset price volatility over time. It is observed inmuch time series data on asset prices that there are periods when variance is high and

periods where variance is low. The ARCH econometric model for this (introduced byEngle (1982)) is that the variance of the series itself is an AR (autoregressive) timeseries, often a linear one.

Formally, per Bollerslev et al 1992 and Engle (1982):



An ARCH model is a discrete time stochastic process {e t} of the form:

et = ztst

where the zt's are iid over time, E(zt)=0, var(zt)=1, and st is positive and time-varying.

Usually st is further modeled to be an autoregressive process.

According to Andersen and Bollerslev 1995/6/7, "ARCH models are usuallyestimated by maximum likelihood techniques." They almost always give a leptokurticdistrbution of asset returns even if one assumes that each period's returns are normal,

because the variance is not the same each period. Even ARCH models, however, donot usually generate enough kurtosis in equity returns to match U.S.Авторегресивна Условна Хетероскедастичност.

ARIMA- ARIMA describes a stochastic process or a model of one. Stands for "autoregressive integrated moving-average". An ARIMA process is made up of sums

of autoregressive and moving-average components, and may not be stationary.

ARMA- Describes a stochastic process or a model of one. Stands for "autoregressivemoving-average". An ARMA process is a stationary one made up of sums of autoregressive and moving-average components.

Arrovian Uncertainty- Arrovian uncertainty is measurable risk, that is, measurablevariation in possible outcomes, on the basis of knowledge or believed assumptions inadvance. Contrast Knightian uncertainty. Аровинска/ски несугурност/ризик.

Arrow- Debreu Equilibrium- Arrow-Debreu equilibrium means, in practice,competitive equilibrium of the kind shown in Debreu's Theory of Value. Occasionallyreferred to as Arrow-Debreu-McKenzie equilibrium. Ароу- Дебре рамнотежа.

Arrow- Pratt Measure- The Arrow-Pratt measure is an attribute of a utility function.

Denote a utility function by u(c). The Arrow-Pratt measure of absolute risk aversion isdefined by:R A=-u''(c)/u'(c)

This is a measure of the curvature of the utility function. This measure is invariant to

affine transformation of the utility function, which is a useful attributed because suchtransformation do not affect the preferences expressed by u().

If R A() is decreasing in c, then u() displays decreasing absolute risk aversion. If R A()is increasing in c, then u() displays increasing absolute risk aversion. If R A() isconstant with respect to changes in c, then u() displays constant absolute risk

aversion. Ароу- Прат Мерило.

Asset Pricing Functions- An asset-pricing function maps the state of the economy attime t into the price of a capital asset at time t. Сооднос на нивото на развој на

едно стопанство во одредено време и вредноста на капиталот

(инфлацијата).



Asset Pricing Models- Asset pricing models are a way of mapping from abstractstates of the world into the prices of financial assets like stocks and bonds. The pricesare always conceived of as endogenous; that is, the states of the world cause them, notthe other way around, in an asset pricing model.

Several general types are discussed in the research literature. The CAPM is one,distinguished from three that Fama (1991) identifies: (a) the Sharpe-Lintner-Black class of models, (b) the multifactor models like the APT of Ross (1976), and (c) theconsumption based models such as Lucas (1978).

An asset pricing model might or might not include the possibility of fads or bubbles.Модел за одредување на вредноста.

Asymptotic- Asymptotic is an adjective meaning 'of a probability distribution assome variable or parameter of it (usually, the size of the sample from another distribution) goes to infinity.

Asymptotic Normality- Asymptotic normality is a property of the limitingdistributions of some estimators. This is usually proven with a mean value expansionof the score at the estimated parameter value.

Asymptotic Variance- Definition of the asymptotic variance of an estimator mayvary from author to author or situation to situation. One standard definition is given inGreene, p 109, equation (4-39) and is described there as "sufficient for nearly allapplications." It's:

asy var(t_hat) = (1/n) * limn->infinity E[ {t_hat - limn->infinity E[t_hat] }2 ] Асимптотски

разлики.

Asymptotically Equivalent- Estimators are asymptotically equivalent if they havethe same asymptotic distribution. Асимптотичка еднаквост.

Asymptotically Unbiased- "There are at least three possible definitions of asymptoticunbiasedness:

1. The mean of the limiting distribution of n.5(t_hat - t) is zero.

2. limn->infinity E[t_hat] = t.

3. plim t_hat = t."

Usually an estimator will have all three of these or none of them. Cases exist however in which left hand sides of those three are different. "There is no general agreementamong authors as to the precise meaning of asymptotic unbiasedness, perhaps becausethe term is misleading at the outset; asymptotic refers to an approximation, whileunbiasedness is an exact result. Nonetheless the majority view seems to be that (2) isthe proper definition of asymptotic unbiasedness. Note, though, that this definitionrelies upon quantities that are generally unknown and that may not exist." -- Greene, p

107. Асимпотичка непристрасност.



Attractor- An attractor is a kind of steady state in a dynamical system. There arethree types of attractor: stable steady states, cyclical attractors, and chaotic attractors.Привлекувач.

Augmented Dickey- Fuller Test- An augmented Dickey-Fuller test is a test for a unit

root in a time series sample. An augmented Dickey-Fuller test is a version of theDickey-Fuller test for a larger and more complicated set of time series models.

The augmented Dickey-Fuller (ADF) statistic, used in the test, is a negative number.The more negative it is, the stronger the rejection of the hypothesis that there is a unitroot at some level of confidence. In one example, with three lags, a value of -3.17constituted rejection at the p-value of .10. Зголемениот Дики- Фулер тест.

Austrian Economics- Austrian Economics is a school of thought that is associatedwith little government interference in the marketplace, the primacy of property rightsand is generally associated with libertarian ideology. Австриската школа за

економија.

Autarky- Autarky is the state of an individual who does not trade with anyone.Автаркија.

Autocorrelation- The jth autocorrelation of a covariance-stationary process isdefined as its jth autocovariance divided by its variance. In a sample, the kthautocorrelation is the OLS estimate that results from the regression of the data on thekth lags of the data. Автокорелација.

Autocovariance- The jth autocovariance of a stochastic process y t is the covariance between its time t value and the value at time t-j. It is denoted gamma below, and E[]means expectation, or mean:gamma jt = E[(yt - Ey)(yt-j-Ey)]

In that equation the process is assumed to be covariance stationary. If there is a trend,then the second Ey should be the expected value of at the time t-j.Автоковаријантност.

Autocovariance Matrix- he autocovariance matrix is defined for a vector random process, denoted yt here. The ij'th element of the autocovariance matrix is cov(y it, y j,t-k )

Матрица на автоковаријантност.

Autoregressive- AR stands for "autoregressive." Describes a stochastic process(denote here, et) that can be described by a weighted sum of its previous values and awhite noise error. An AR(1) process is a first-order one process, meaning that only theimmediately previous value has a direct effect on the current value:

et = ret-1 + ut

where r is a constant that has absolute value less than one, and u t is drawn from adistribution with mean zero and finite variance, often a normal distribution.

An AR(2) would have the form:



et = r 1et-1 + r 2et-2 + ut

and so on. Авторегресивност.

Avar- Avar is an abbreviation or symbol for the operation of taking the asymptotic

variance of an expression, thus: avar().

Average Propensity To Consume- The average propensity to consume is the proportion of income the average family spends on goods and services.Потрошувачка кошница.

Average Propensity To Save- The average propensity to save is the proportion of income the average family saves (does not spend on consumption). Месечно

штедење.

Average Total Cost- Average total cost is the sum of all the production costs divided

by the number of units produced. Просечно потрошени материјали попроизвод..

BB1- B1 denotes the Borel sigma-algebra of the real line. It will contain every openinterval by definition, which implies that it contains every closed interval and every

countable union of open, half-open, and closed intervals.

What won't it contain? In practice, only obscure sets. Here's an example: Define theequivalence class ~ on the real line such that x~y (read: x is in the same equivalenceclass as y) if x-y is a rational number. Now consider the set of all numbers in [0,1]such that none of them are in the same equivalence class. How many members of thatset are there? Well, it's not a countable number. This set is not in B 1

Bads- Bads are the opposite of "goods". Bads are most often physical items that people will usually pay money to dispose of like toxic waste. Отпадни материјали.

Balance Of Payments- A country's balance of payments is the quantity of its owncurrency flowing out of of the country (for purchases, for example, but also for giftsand intrafirm transfers) minus the amount flowing in. Трговски биланс.

Balanced Budget- A balanced budget occurs when the total sum of money agovernment collects in a year is equal to the amount it spends on goods, services, anddebt interest. Урамнотежен буџет.

Balanced Growth- A macroeconomics model exhibits balanced growth if consumption, investment, and capital grow at a constant rate while hours of work per time period stays constant. Урамнотежен развој.

Banach Space- Any complete normed vector space is a Banach space.



Bandwidth- In kernel estimation, a scalar argument to the kernel function thatdetermines what range of the nearby data points will be heavily weighted in makingan estimate. The choice of bandwidth represents a tradeoff between bias (which isintrinsic to a kernel estimator, and which increases with bandwidth), and variance of the estimates from the data (which decreases with bandwidth).

Cross-validation is one way to choose the bandwidth as a function of the data.

Has a variety of similar definitions in spectral analysis. Generally, a bandwidth issome way of defining the range of frequencies that will be included by the estimation

process. In some estimations it is an argument to the estimation process.

Bank Note- In periods of free banking, such as most states in the U.S. from 1839-1863, banks could issue their own money, called bank notes. A bank note was a risky,

perpetual debt claim on a bank which paid no interest, and could be redeemed ondemand at the original bank, usually in gold. There was a risk that the bank would not

be able or willing to redeem it. Банкнота.

Bank Run- A bank run takes place when the customers of a bank fear that the bank will become insolvent. Customers rush to the bank to take out their money as quicklyas possible to avoid losing it. Federal Deposit Insurance has ended the phenomenon of

bank runs. Напуштање банка (поради голем ризик дека ќе стане

несолвентна).

Barter Economy- A barter economy is an economy that lacks a commonly acceptedcurrency, so all exchanges must be made with goods and services because moneydoes not exist in these economies. Бартер економија (Економија без парична

единица).

Base Point Pricing- Base pointing pricing is the practice of firms setting prices as if their transportation costs to all locations were the same, even if all the vendors aredistant from one another and have substantially different costs of transportation toeach location. One might interpret this as a form of monitored collusion between thevendor firms. Еднаква цена за сите производи, без разлика на транспортните

трошоци.

Basin Of Attraction- The basin of attraction is the region of states, in a dynamical

system, around a particular stable steady state, that lead to trajectories going to thestable steady state. (E.g. the region inside the event horizon around a black hole.)

Basis Point- A basis point is one-hundredth of a percentage point. Used in the contextof interest rates.

Basket- A basket is a known set of fixed quantites of known goods, needed for defining a price index. Кошница.

Bear Market- A bear market occurs when almost all stock prices are falling. Theterm bear market comes from the image of a bear pawing something to the ground.

Пазар на акции чии што цени паѓаат.



Bellman Equation- A Bellman equaion is any value or flow value equation. For adiscrete problem it can generally be of the form:

v(k) = max over k' of { u(k,k') + b*v(k') }

where:

u() is the one-period return function (e.g., a utility function) andv() is the value function andk is the current state andk' is the state to be chosen and

b is a scalar real parameter, the discount rate, generally slightly less than one.

Bertrand Competition- A Bertrand competition is a bidding war in which the bidders end up at a zero-profit price. Бертрандов натпревар.

Bertrand Duopoly- A bertrand duopoly is a bidding war in which the bidders end upat a zero-profit price. Бертрандов дуопол.

Bertrand Game- A Bertrand game is a model of a bidding war between firms each of which can offer to sell a certain good (say, widgets), but no other firms can. Each firmmay choose a price to sell widgets at, and must then supply as many as are demanded.Consumers are assumed to buy the cheaper one, or to purchase half from each if the

prices are the same.

Best for the firms (both collectively and individually) is to cooperate, charge

monopoly price, and split the profits. Each firm could seize the whole market bylowering price slightly, however, and the noncooperative Nash equilibrium outcomeof a Bertrand game is that both charge a zero-profit price. Бертрандова игра.

Beveridge Curve- A Beveridge curve is the graph of the inverse relation of unemployment to job vacancies. Зголемена невработеност.

BHHH- BHHH is a numerical optimization method from Berndt, Hall, Hall, andHausman (1974). Used in Gauss, for example. Бернд, Хал, Хал и Хаусман.

Bias- Bias is the difference between the parameter and the expected value of the

estimator of the parameter. Разликата помеѓу очекуваната и добиенатавредност на параметарот.

Bidding Function- In an auction analysis, a bidding function (often denoted b()) is afunction whose value is the bid that a particular player should make. Often it is afunction of the player's value, v, of the good being auctioned. Thus the commonnotation b(v). Понуда на тендер.

Bill Of Exchange- A bill of exchange is from the late Middle Ages. A bill of exchange is a contract entitling an exporter to receive immediate payment in the localcurrency for goods that would be shipped elsewhere. Time would elapse between

payment in one currency and repayment in another, so the interest rate would also be



brought into the transaction. Договор за извезување стока, каде што фирмата-

купувач плаќа во домашна валута.

Billon- Billon is a mixture of silver and copper, from which small coins were made inmedieval Europe. Larger coins were made of silver or gold. Билон (Легура од

сребро и бакар која се користела за ковање парички).

Bimetallism- Bimetallism is a commodity money regime in which there is concurrentcirculation of coins made from each of two metals and a fixed exchange rate betweenthem. Historically the metals have almost always been gold and silver. Bimetallismwas tried many times with varying success but since about 1873 the practice has beengenerally abandoned. Биметализам.

Black- Scholes Equation- The Black-Scholes equation is an equation for optionsecurities prices on the basis of an assumed stochastic process for stock prices.

The Black-Scholes algorithm can produce an estimate the value of a call on a stock,using as input:

• an estimate of the risk-free interest rate now and in the near future

• current price of the stock

• exercise price of the option (strike price)

• expiration date of the option

• an estimate of the volatility of the stock's price

From the Black-Scholes equation one can derive the price of an option.

Blue Chip- The term blue chip usually refers to a stock, but could in theory apply toany financial asset with potential risk. A blue chip stock is one that entails unusuallysmall risk (risk being a subjective judgment). Stocks that are considered "blue chip"are issued by large stable corporations like IBM. Минимизирање на ризикот,

максимизирање на добивката.

Bond- A bond is a fixed interest financial asset issued by governments, companies, banks, public utilities and other large entities. Bonds pay the bearer a fixed amount aspecified end date. A discount bond pays the bearer only at the ending date, while acoupon bond pays the bearer a fixed amount over a specified interval (month, year,

etc.) as well as paying a fixed amount at the end date. Обврзница.

Bond Rating- Organizations like Standard and Poor's and Moody's rate the riskinessof corporate, municipal, and government issued securities and gives each security aBond Rating. The bond rating, or more accurately the risk, is based on two elements:the probability the organization will file for bankruptcy before the final bond paymentis due and what percentage of the bondholder's clams creditors will receive if a

bankruptcy takes place.

Bonferroni Criterion- Suppose a certain treatment of a patient has no effect. If oneruns a test of statistical significance on enough randomly selected subsets of the

patient base, one would find some subsets in which statistically significant differenceswere apparently distinguished by the treatment. The Bonferroni criterion is a



redefinition of the statistical signficance criterion for the testing of many subgroups:e.g. if there are five subgroups and one of them shows an effect of the treatment at the.01 significance level, the overall finding is significant at the .05 level. Критериумот

Бонферони.

Bootstrapping Criterion- Bootstrapping is the activity of applying estimators to eachof many subsamples of a data sample, in the hope that the distribution of the estimator applied to these subsamples is similar to the distribution of the estimator when appliedto the distribution that generated the sample.

It is a method that gives a sense of the sampling variability of an estimator. "After theset of coefficients b0 is computed, M randomly drawn samples of T observations aredrawn from the original data set with replacement . T may be less than or equal to n,the sample size. With each such sample the ... estimator is recomputed." -- Greene, p658-9.

The properties of this distribution of estimates of b0 can then be characterized, e.g. itsvariance. If the estimates are highly variable, the investigator knows not to think of the estimate of b0 as precise.

Bootstrapping could also be used to estimate by simulation, or empirically, thevariance of an estimation procedure for which no algebraic expression for thevariance exists.

Borel Set- A Borel set is any element of a Borel sigma-algebra. Борел сет.

Borel- Sigma Algebra- The Borel sigma-algebra of a set S is the smallest sigma-algebra of S that contains all of the open balls in S. Any element of a Borel sigma-algebra is a Borel Set.

Example: The set B1 is the Borel sigma-algebra of the real line, and thus containsevery open interval.

Example: Consider a filled circle in the unit square. It can be constructed by acountable number of non-overlapping open rectangles (since a series of suchrectangles can be defined that would cover every point in the circle but no pointoutside of it. Therefore it is in the smallest sigma-algebra of open subsets of the unit

square. Борел- Сигма алгебра.

Bounded Rationality- Models of bounded rationality are defined in a recent book byAriel Rubinstein as those in which some aspect of the process of choice is explicitlymodelled.

Box- Cox Transformation- The Box-Cox transformation, below, can be applied to aregressor, a combination of regressors, and/or to the dependent variable in aregression. The objective of doing so is usually to make the residuals of the regressionmore homoskedastic and closer to a normal distribution:

y(l) = ((y^L) - 1) / l for l not equal to zero y(l)=log(y)L=0 Box and Cox (1964)developed the transformation.



Estimation of any Box-Cox parameters is by maximum likelihood.

Box and Cox (1964) offered an example in which the data had the form of survivaltimes but the underlying biological structure was of hazard rates, and thetransformation identified this. Бокс- Кокс трансформација.

Box- Jenkins- Box-Jenkins is a "methodology for identifying, estimating, andforecasting" ARMA models. (Enders, 1996, p 23). The reference in the name is toBox and Jenkins, 1976.

Box- Pierce Statistic- The Box-Pierce statistic is defined on a time series sample for each natural number k by the sum of the squares of the first k sample autocorrelations.The k th sample autocorrelation is denoted r:BP(k)=Ss=1

k [r s2]

Used to tell if a time series is nonstationary. Бокс- Џенкинс

Brent Method- The Brent method is an algorithm for choosing the step lengths whennumerically calculating maximum likelihood estimates. Методот Брент.

Bretton- Woods System- The Bretton Woods system was a international monetaryframework of fixed exchange rates after World War II. Drawn up by the U.S. andBritain in 1944. Keynes was one of the architects.

The Bretton Woods system ended on August 15, 1971, when President Richard Nixonended trading of gold at the fixed price of $35/ounce. At that point for the first time in

history, formal links between the major world currencies and real commodities weresevered. Системот Бретон- Вудс.

Breusch- Pagan Statistic- A diagnostic test of a regression. It is a statistic for testingwhether dependent variable y is heteroskedastic as a function of regressors X. If it is,that suggests use of GLS or SUR estimation in place of OLS. The test statistic isalways nonnegative. Large values of test statistic reject the hypothesis that y ishomoskedastic in X. The meaning of 'large' varies with the number of variables in X.

Quoting almost directly from the Stata manual: The Breusch and Pagan (1980) chi-squared statistic -- a Lagrange multiplier statistic -- is given by

l = T * [Sm=1m=M [Sn=1

n=m-1 [r mn2 ]]

where r mn2 is the estimated correlation between the residuals of the M equations and T

is the number of observations.

Bubbles- The existence of bubbles is the conjecture that market prices for securitiestake self-fulfilling swings away from any model of their fundamental values.

Bubbles are often described as speculative and it is conjectured that bubbles could berisky ventures for speculators who earn a fair rate of return on them.

http://economics.about.com/library/glossary/bldef-heteroskedastic.htm


http://economics.about.com/library/glossary/gls.htm



http://economics.about.com/library/glossary/sur.htm

http://economics.about.com/library/glossary/os.htm



http://economics.about.com/library/glossary/sur.htm

http://economics.about.com/library/glossary/os.htm



Budget- A budget is a description of a financial plan. It is a list of estimates of revenues to and expenditures by an agent for a stated period of time. Normally a

budget describes a period in the future not the past. Буџет.

Budget Line- A consumer's budget line characterizes on a graph the maximum

amounts of goods that the consumer can afford. In a two good case, we can think of quantities of good X on the horizontal axis and quantities of good Y on the verticalaxis. The term is often used when there are many goods, and without reference to anyactual graph. Буџетска горна граница.

Budget Set- The budget set is the set of bundles of goods an agent can afford. This setis a function of the prices of goods and the agents endownment.

Assuming the agent cannot have a negative quantity of any good, the budget set can be characterized this way. Let e be a vector representing the quantities of the agent'sendowment of each possible good, and p be a vector of prices for those goods. Let

B(p,e) be the budget set. Let x be an element of R+L; that is, the space of nonnegative

reals of dimension L, the number of possible goods. Then:

B(p,e) = {x: px <= pe} Буџетски сет.

Bull Market- A bull market occurs when almost all stock prices are on the rise. Theterm bull market comes from the image of a bull flinging things into the air with hishorns. Пазар на акции чија што цена расте.

Bureaucracy- A bureaucracy is a form of organization in which officeholders have

defined positions and (usually) titles. Formal rules specify the duties of theofficeholders. Personalistic distinctions are usually discouraged by the rules.Бирократија.

Burr Distribution- A Burr distibution has density function (pdf):

f(x) = ckxc-1(1+xc)k+1 for constants c>0, k>0, and for x>0.

Has distribution function (cdf): F(x) = 1 - (1+xc)-k

Business Cycle Frequency- The business cycle frequency is considered to be three to

five years. Called the business cycle frequency by Burns and Mitchell (1946), and this became standard language. Фрекфренција на бизнис циклус.

Buyer’s Market- A buyer's market is a market for a good (stocks, housing, etc.)where prices are falling and there are more parties interested in selling than in buying.Пазар со голема понуда, а мала побарувачка.



CCalculus Of Voting- The calculus of voting is a model of political voting behavior inwhich a citizen chooses to vote if the costs of doing so are outweighed by the strengthof the citizen's preference for one candidate weighted by the anticipated probabilitythat the citizen's vote will be decisive in the election. Гласачки калкулус.

Calibration- 1. Calibration is the estimation of some parameters of a model, under the assumption that the model is correct, as a middle step in the study of other

parameters. Use of this word suggests that the investigator wishes to give those other parameters of the model a 'fair chance' to describe the data, not to get stuck in a sidediscussion about whether the calibrated parameters are ideally modeled or estimated.

2. Calibration is taking parameters that have been estimated for a similar model intoone's own model, solving one's own model numerically, and simulating. Attributed toEdward Prescott. Калибрација.

Call Options- A call option is a contract that gives the bearer the right to buy a shareat a given price. Usually these options expire after a certain date. Договор за

купување акции по дадена цена.

Capital- Capital is something owned which provides ongoing services. In the nationalaccounts, or to firms, capital is made up of durable investment goods, normallysummed in units of money. Broadly: land plus physical structures plus equipment.The idea is used in models and in the national accounts. Капитал.

Capital Consumption- In national accounts, capital consumption is the amount bywhich gross investment exceeds net investment. It is the same as replacementinvestment. Случај кога бруто инвестицијата ја надминува нето

инвестицијата.

Capital Deepening- Capital deepening is an increase in capital intensity, normally ina macro context where it is measured by something analogous to the capital stock available per labor hour spent. In a micro context, it could mean the amount of capital

available for a worker to use, but this use is rare.

Capital deepening is a macroeconomic concept, of a faster-growing magnitude of capital in production than in labor. Industrialization involved capital deepening - thatis, more and more expensive equipment with a lesser corresponding rise in wageexpenses.

Capital deepening of a certain input (e.g. a certain kind of capital input, a recent keyexample being computer equipment) can be measured in the following way. Estimatethe growth of the services provided by this input, per unit of labour input, in year Tand in year T+1. Зголемување на капиталниот интензитет.



Capital Intensity- Capital intensity is the amount of capital per unit of labour input.Капитален интензитет.

Capital Ratio- The capital ratio is a measure of a bank's capital strength used by U.S.regulatory agencies. Мерило за солвентност на банките (во САД).

Capital Structure- The capital structure of a firm is broadly made up of its amountsof equity and debt. Структура на капиталот.

Capital- Augmenting- Capital-augmenting is one of the ways in which aneffectiveness variable could be included in a production function in a Solow model. If effectiveness A is multiplied by capital K but not by labor L, then we say theeffectiveness variable is capital-augmenting.

For example, in the model of output Y where Y=(AK) aL1-a the effectiveness variableA is capital-augmenting but in the model Y=AK aL1-a it is not.

Another example would be a capital utilization variable as measured say by electricityusage. (E.g., as in Eichenbaum).

An example: in the context of a railroad, automatic railroad signaling, track-switching, and car-coupling devices are capital-augmenting. From Moses Abramovitzand Paul A. David, 1996. "Convergence and Deferred Catch-up: productivityleadership and the waning of American exceptionalism." In Mosaic of Economic

Growth, edited by Ralph Landau, Timothy Taylor, and Gavin Wright.

Capitation- Capitation is the system of payment for each customer served, rather than by service performed. Both are used in various ways in U.S. medical care.Капитација.

Cash-in-advance Constraint- The cash-in-advance constraint is a modeling idea. Ina basic Arrow-Debreu general equilibrium there is no need for money becauseexchanges are automatic, through a Walrasian auctioneer. To study monetary

phenomena, a class of models was made in which money was required to make purchases of other goods. In such a model the budget constraint is written so that theagent must have enough cash on hand to make any consumption purchase. Using thismechanism money can have a positive price in equilibrium and monetary effects can

be seen in such models. Contrast money-in-the-utility function for an alternativemodeling approach. Плаќање однапред.

Cartels- Cartels are agreements between most or all of the major producers of a goodto either limit their production and/or fix prices. Cartels are generally illegal in theUnited States. Картел (Договор меѓу доминантни производители на одреден

производ за одредување монополска цена).

Cauchy Distribution- Has thicker tails than a normal distribution.

density function (pdf): f(x) = 1/[pi*(1+x2)].

distribution function (cdf): F(x) = .5 + (tan-1x)/pi.



CDF (Cumulative Distribuion Function)- CDF is short for cumulative distributionfunction. This function describes a statistical distribution. It has the value, at each

possible outcome, of the probability of receiving that outcome or a lower one. A cdf isusually denoted in capital letters.

Consider for example some F(x), with x a real number is the probability of receiving adraw less than or equal to x. A particular form of F(x) will describe the normaldistribution, or any other unidimensional distribution.

Censored Dependent Variables- A dependent variable in a model is censored if observations of it cannot be seen when it takes on vales in some range. That is, theindependent variables are observed for such observations but the dependent variableis not.

A natural example is that if we have data on consumers and prices paid for cars, if aconsumer's willingness-to-pay for a car is negative, we will see observations with

consumer information but no car price, no matter how low car prices go in the data.Price observations are then censored at zero.

Contrast truncated dependent variables.

Censored Least Absolute Deviations- CLAD stands for the "Censored LeastAbsolute Deviations" estimator. If errors are symmetric (with median of zero), thisestimator is unbiased and consistent though not efficient. The errors need not behomoskedastic or normally distributed to have those attributes.

Center for Research in Security Prices- CRSP stands for Center for Research inSecurity Prices, a standard database of finance information at the University of Chicago. Has daily returns on NYSE, AMEX, and NASDAQ stocks.

Started in early 1970s by Eugene Fama among others. The data there was so muchmore convenient than alternatives that it drove the study of security prices for decadesafterward. It did not have volume data which meant that volume/volatility tests wererarely done. Центар за истражување на стабилноста на цените.

Central Banks- A central bank is a government bank; a bank for banks. Централна

банка, Народна банка.

Certainty Equivalence Principle- Imagine that a stochastic objective function is afunction only of output and output-squared. Then the solution to the optimization

problem of choosing output will have the special characteristic that only theconditional means of the future forcing variables appear in the first order conditions.(By conditional means is meant the set of means for each state of the world.) Then thesolution has the "certainty equivalence" property. "That is, the problem can beseparated into two stages: first, get minimum mean squared error forecasts of theexogenous [variables], which are the conditional expectations...; second, at time t,solve the nonstochastic optimization problem," using the mean in place of the randomvariable. "This separation of forecasting from optimization.... is computationally very

convenient and explains why quadratic objective functions are assumed in muchapplied work. For general [functions] the certainty equivalence principle does not



hold, so that the forecasting and opt problems do not 'separate.'" Принцип за

здобивање безбедност.

Certainty Equivalent- The amount of payoff (e.g. money or utility) that an agentwould have to receive to be indifferent between that payoff and a given gamble is

called that gamble's 'certainty equivalent'. For a risk averse agent (as most areassumed to be) the certainty equivalent is less than the expected value of the gamble

because the agent prefers to reduce uncertainty. Здобивање безбедност.

CES Production Function- CES stands for constant elasticity of substitution. This isa function describing production, usually at a macroeconomic level, with two inputswhich are usually capital and labor. As defined by Arrow, Chenery, Minhas, andSolow, 1961 (p. 230), it is written this way:

V = (beta*K -rho + alpha*L-rho) -(1-rho) where V = value-added, (though y for output ismore common),

K is a measure of capital input,L is a measure of labour input,and the Greek letters are constants. Normally alpha > 0 and beta > 0 and rho > -1. For more details see the source article.

In this function the elasticity of substitution between capital and labor is constant for any value of K and L. Постојна еластичност при замена (ПЕЗ).

CES Technology- An example of CES technology, adapted from Caselli andVentura:

For capital k, labor input n, and constant b<f(k,n) = (k b + n b)1/b

Here the elasticity of substitution between capital and labor is less than one, i.e. 1/(1- b)<1. ПЕЗ Технологија.

CES Utility- CES utility stands for Constant Elasticity of Substitution utility, a kindof utility function. A synonym for CRRA or isoelastic utility function. Often writtenthis way, presuming a constant g not equal to one:

u(c)=c1-g

/(1-g)

This limits to u(c)=ln(c) as g goes to one.

The elasticity of substitution between consumption at any two points in time isconstant, equal to 1/g. "The elasticity of marginal utility is equal to" -g. g can also besaid to be the coefficient of relative risk aversion, defined as -u"(c)c/u'(c), which iswhy this function is also called the CRRA (constant relative risk aversion) utilityfunction. Придобивки, благодети од ПЕЗ.

Ceteris Paribus- Ceteris Paribus means "assuming all else is held constant". The

author using ceteris paribus is attempting to distinguish an effect of one kind of change from any others. Цетерис Парибус.



Користена литература:

“Економика на Македонија”- Ангел Георгиев, Методија Несторовски

Glossary of Economics Terms / Economics Dictionary од Internet

Glossary of Economics Terms

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