Equilibrium Analysis. In the market for any particular good X, the decisions of buyers interact simultaneously with the decisions of sellers. When the demand for good X equals the supply of good X, the market for good X is said to be in equilibrium.
Partial equilibrium analysis focuses on the market in which the tax is imposed, whereas general equilibrium analysis looks at many markets.
General equilibrium analysis includes inter generational redistribution and partial equilibrium analysis looks only at the effects on one generation.
Comments
Post a Comment