Dynamic efficiency
From Wikipedia, the free encyclopedia
Dynamic efficiency is a term in economics, which refers to an economy that appropriately balances short run concerns (static efficiency) with concerns in the long run (focusing on encouraging research and development).[1]
Dynamic efficiency in growth model
The Ramsey-Cass-Koopmans model does not have dynamic efficiency problems, but the Diamond Growth model is dynamically inefficient because of the overlapping generation setup; there is an allocation point which is better than the competitive equilibrium allocation point.[citation needed]
See also
- Creative destruction and Joseph Schumpeter
- Productive efficiency and Pareto efficiency and Kaldor-Hicks efficiency
- Allocative efficiency
- X-efficiency
- Prices, profit (economics) and property rights
- Economic efficiency
- Hotelling's rule
Notes
- ↑ Joseph E Stiglitz and Carl E Walsh, Economics (London, WW Norton, 4th Ed, 2006) Glossary A-3
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