adjustment speed

the rate at which MARKETS adjust to changing economic circumstances. Adjustment speeds will tend to vary between different types of market. For example, in the case of the FOREIGN EXCHANGE MARKET, the exchange rate of a currency will tend to adjust rapidly to EXCESS SUPPLY or EXCESS DEMAND for it. A similar rapid response tends to characterize COMMODITY MARKETS and MONEY MARKETS, with commodity prices and INTEREST RATES changing quickly as supply or demand conditions warrant. Product markets (see PRICE SYSTEM) tend to adjust more slowly because the prices of products are usually fixed administratively and are generally changed infrequently in response to major supply or demand changes. Finally, some commodity markets, in particular the LABOUR MARKET, tend to adjust more slowly still because wages tend to be fixed through longer-term collective bargaining arrangements. See WAGE STICKINESS.

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References in periodicals archive ?

Normally, the literature (e.g., Flannery and Rangan, 2006; Byoun, 2008; Lemmon, Roberts, and Zender, 2008; Huang and Ritter, 2009) estimates leverage adjustment speed with the following regression model:

Bank Competition and Leverage Adjustments

where [alpha] > 0, [beta] > 0, and [gamma] > 0 are the adjustment speed for the three firms, respectively.

Complexity Analysis of a Triopoly Cooperation-Competition Game Model in Convergence Product Market

In the equation above, [[theta].sub.i] (i = 1, 2) is the price adjustment speed of retailer i, and the price adjustment speed is positive, which is set to make sure that retail price of next period is practically significant.

Complexity Dynamic Character Analysis of Retailers Based on the Share of Stochastic Demand and Service

But the factor that swayed us toward the EGC was the adjustment speed. We make a lot of different products on the same line, so what's important to us is to reduce setup times and really tighten the time it takes to produce commercial-quality film, which reduces scrap rates." Compared with its previous air rings, the Addex EGC provided a 50% improvement in thickness control for all products on all three lines, Lord states.

Air-ring upgrades get film processor quickly up to spec: PolyExpert's trials lead to installation of three new air rings and one digital IBC control to speed changeovers and reduce scrap

In the previous equation, [v.sub.i], [[alpha].sub.i] [greater than or equal to] 0 (i = 1, 2, 3) are the adjustment speed of retailer i for its recycle price [p.sub.i] and new product supply quantity [q.sub.i].

The complexity uncertain analysis about three differences old and new product pricing oligarch retailers closed-loop supply chain

Based on the strategy recognition and the two-stage working capital adjustment model, the adjustment speed of working capital and its influential factors on different strategic choices are analyzed and compared by panel data.

Working capital management, corporate performance, and strategic choices of the wholesale and retail industry in China

By allowing asymmetric and nonlinear adjustment processes, it was shown that the gap between the policy rate and the retail banking rates is the driving force of the interest rate pass-through so that when this gap is high the adjustment pace is rapid and when this gap is small the adjustment speed is slow.

Interest rate pass-through in Turkey and impact of global financial crisis: asymmetric threshold cointegration analysis

We consider the standard partial adjustment model for empirical analysis of adjustment speed because it can succinctly capture much of the lagged adjustment to new information.

Stock market adjustment to earnings announcement in the presence of accounting irregularity allegations

Nevertheless, linear techniques limit the adjustment between oil and stock prices to being symmetric, linear and continuous, and therefore the adjustment speed to being time-invariant.

Nonlinear linkages between oil and stock markets in developed and emerging countries

When [[lambda].sub.p] = 1, then the population size ([P.sub.i,t]) of the urban planning area i will equal the reasonable value ([P.sup.E.sub.i,t]) in the tth review; population growth has attained the reasonable scale, and the adjustment speed is also reasonable.

The causal relationship of population growth and land development: a case study in Southern Taiwan

Lowering euro area price adjustment costs to the del lower US level, while leaving employment adjustment costs constant, does not visibly affect the adjustment speed of real variables either.

Speed of adjustment to selected labour market and tax reforms

Indeed, due to the presence of frictions in the insurance market, the heterogeneity of insurers' expectations, the competition between insurers, and a strong interdependence between insurance markets, the insurance premium dynamics seem to be asymmetrical, discontinuous, and nonlinear with a time-varying adjustment speed. Besides, Higgins and Thistle (2000), considering a smooth transition regression (STAR) model, showed that the underwriting profits follow a stochastic process with time-varying parameters.

Nonlinear cointegration relationships between non-life insurance premiums and financial markets