elasticity of supply

Elasticity of supply

The degree of producers' responsiveness to price changes. Elasticity is measured as the percent change in quantity divided by the percent change in price. A large value (greater than 1) of elasticity indicates sensitivity of supply to price, e.g., luxury goods, where a rise in price causes an increase in supply. Goods with a small value of elasticity (less than 1) have a supply that is insensitive to price, e.g., food, where a rise in price has little or no effect on the amount that producers supply.

Elasticity of Supply

The relative stability of a security's or product's supply in the face of increased or decreased price. Typically, an increased price results in greater supply because fewer people are buying the product; these products are considered inelastic. For example, Rolex watches are considered inelastic because a higher price results in fewer people purchasing the watches, which, in turn, results in an increased supply. On the other hand, staple products like food and clothing are considered elastic because an increased price does not necessarily lead to more supply. This is because people continue to buy food and (some) clothing. See also: Elasticity of demand.

elasticity of supply

the degree of responsiveness of quantity supplied of a particular product (see SUPPLY) to changes in the product's PRICE (PRICE-ELASTICITY OF SUPPLY).
References in periodicals archive ?
While this growth in oil has made US self-sufficient, the shale industry has completely changed the elasticity of supply of this commodity.
The study calculated a price elasticity of supply in the range of 0.
The price elasticity of supply is found to be relatively high: a 10 percent increase in the price that homeowners are willing to pay for coverage results in a 27 percent increase in the number of policies supplied.
Specifically, using the estimated elasticity of supply and demand, that is, 0.
Becker and his colleagues argue that more women than men currently go to college because women's elasticity of supply with respect to earnings is greater than men's.
s]/[GAMMA]) = p, so the market elasticity of supply is
Similarly, the elasticity of supply is computed like this:
The model developed in this article shows that three elasticities--the inframarginal elasticity of supply, the participation elasticity, and the demand elasticity--are critical to the setting of a two-part price when the monopoly and the monopsony powers of the aggregator are considered.
Unlike corn, sugar is an example of a renewable feedstock that has stable pricing due to the elasticity of supply.
From Equation 5, the elasticity of supply of wheat with respect to farm level price was 0.
The wage elasticity of supply for existing workers is found to be negative for each direct care occupation, even with a measure of labour supply that takes into account desired hours of work.
Thus, contrary to conventional wisdom, price data provide no information on the elasticity of supply.