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Related to Accelerators: Particle accelerators, Linear accelerators

Accelerator Principle

The idea that a small change in consumer behavior can have a large effect on a company's investment. For example, suppose $100 of investment in a bakery produces $100 worth of baked goods. If consumers usually buy $100 of baked goods each year but this increases to $110, the bakery must buy 10% more equipment, baking materials, and so forth, which can increase the amount it invests in its suppliers by more than 10%. The accelerator principle exacerbates advances and declines; it is used in various models of the business cycle. See also: Multiplier.
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Fig. 2 Accelerator. The graph shows how gross national product and the level of investment vary over time.


the relationship between the amount of net or INDUCED INVESTMENT (gross investment less REPLACEMENT INVESTMENT) and the rate of change of NATIONAL INCOME. A rapid rise in income and consumption spending will put pressure on existing capacity and encourage businesses to invest, not only to replace existing capital as it wears out but also to invest in new plant and equipment to meet the increase in demand. By way of simple illustration, let us suppose a business meets the existing demand for its product, utilizing 10 machines, one of which is replaced each year. If demand increases by 20%, it must invest in two new machines to accommodate that demand in addition to the one replacement machine.

Investment is thus, in part, a function of changes in the level of income: I = f(AY). A rise in induced investment, in turn, serves to reinforce the MULTIPLIER effect in increasing national income.

The combined effect of accelerator and multiplier forces working through an investment cycle has been offered as an explanation for changes in the level of economic activity associated with the BUSINESS CYCLE. Because the level of investment depends upon the rate of change of GNP, when GNP is rising rapidly then investment will be at a high level, as producers seek to add to their capacity (time t in Fig. 2). This high level of investment will add to AGGREGATE DEMAND and help to maintain a high level of GNP. However, as the rate of growth of GNP slows down from time t onward, businesses will no longer need to add as rapidly to capacity, and investment will decline towards replacement investment levels. This lower level of investment will reduce aggregate demand and contribute towards the eventual fall in GNP. Once GNP has persisted at a low level for some time, then machines will gradually wear out and businesses will need to replace some of these machines if they are to maintain sufficient production capacity to meet even the lower level of aggregate demand experienced. This increase in the level of investment at time t1 will increase aggregate demand and stimulate the growth of GNP Like FIXED INVESTMENT, investment in stock is also to some extent a function of the rate of change of income so that INVENTORY INVESTMENT is subject to similar accelerator effects.

References in periodicals archive ?
The newly achieved electron pulses, which last only tens of femtoseconds, pack energy up to 1,000 times as densely as did electron packets produced by wakefield accelerators of the past, Katsouleas notes.
The cure characteristic data obtained with various individual accelerators or in combinations, are recorded in tables 3 and 4.
Enabling next-generation networking equipment to work faster, smarter and more efficiently and manufactured on 90 nm process technology, the IDT search accelerators process complex IPv6 policy lookups at 40 Gbps throughput and above.
Amine type accelerators and zinc salts result in significantly lower viscosities and greater nerve because of their de-agglomerating effect on the filler.
The new accelerator will enable doctors to both scan the proton beam over a target area of tissue and quickly change the energy of the speeding protons, says principal designer Lee Teng, a senior physicist at Fermilab.
The network search accelerator also comes with additional development tools that facilitate easy programming and early testing, reducing cost, speeding time-to-market, and ultimately protecting the end-user software investment.
The effect of benzophenone-amine condensation products as vulcanization accelerators in NR mixes In the same manner, these compounds were incorporated in NR mixes.
At higher temperatures, the 2-mile-long copper tube at the heart of the linear accelerator begins to warm and expand, causing other problems.
Instead of a traditional copper accelerator cavity, CEBAF is to have a niobium cavity that is kept chilled to --455|F, just a few degrees above absolute zero.
Joint Forces Command (USJFCOM) has selected, installed and integrated the Expand Accelerator model 4820 into the Joint Systems Integration Center (JSIC) Command and Control on the Move (C2OTM) system.