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| Term | Definition |
|---|---|
| Nash Equilibrium | In game theory, the Nash equilibrium is the solution of a non-cooperative game involving two or more players. Named after John Forbes Nash Jr., in a Nash equilibrium, each player knows the equilibrium strategies of others, and no player gains by changing only their strategy. |
| National Tax | Any tax paid to a national or federal government, such as income tax, tariffs, and social security taxes. |
| National Wealth | The total value of capital and private property owned within a country. |
| Natural Monopoly | An industry where one large producer can produce at lower costs than many small producers, often becoming the sole surviving firm in the industry. |
| Natural Monopoly | In some industries, economies of scale lead to a single supplier being the most efficient. Governments typically oversee natural monopolies through public ownership or regulation. |
| Natural Rate Of Unemployment | According to neoclassical economics, the wage rate is determined by labor-market clearing, resulting in a “natural” level of unemployment due to frictional, structural, or disguised effects. Attempts to reduce unemployment below this natural rate may lead to inflation. |
| Natural Resource Economics | Deals with the supply, demand, and allocation of the Earth’s natural resources. |
| Need | Any good or service fundamental for survival, such as food, clothing, and shelter. |
| Neoclassical Economics | The dominant approach to economics, explaining economic behavior based on competitive, utility-maximizing actions by companies, workers, and consumers. It assumes full resource utilization and payment based on productivity. |
| Neoliberalism | A modern, harsh form of capitalism dominant since the early 1980s, emphasizing deregulation, privatization, globalization, and strict monetary policy. |
| Nominal GDP | Measures the total value of goods and services produced and traded for money in the formal economy at current prices. Nominal GDP can increase due to increased output or average prices (inflation). |
| Nominal Interest Rates | Interest rates stated in terms of money borrowed and returned, without adjusting for inflation. |
| Nominal Prices | Money prices that can change over time due to inflation. |
| Nominal Wages | Wages measured in money. |
| Non-Accelerating-Inflation Rate Of Unemployment (NAIRU) | A variant of the natural rate of unemployment theory, stating that reducing unemployment below a certain level may lead to continuous inflation acceleration. Policies to address this align with natural rate theory, focusing on market efficiency. |
| Non-Convexity | In economics, non-convexity refers to violations of the convexity assumptions of elementary economics. |
| Non-Price Determinant Of Demand | Any factor other than price influencing the willingness to buy a good or service, such as fads, income, taste, future expectations, and population. |
| Non-Rivalry | In economics, a good is rivalrous if its consumption by one party prevents simultaneous consumption by others. |
| Non-Tradeable | Some products cannot be transported over long distances and are considered non-tradeable. Examples include most services and certain goods. |
| Natural Monopoly | A market structure where a single firm can efficiently provide goods or services due to high fixed costs and low marginal costs. Natural monopolies often occur in industries with significant infrastructure requirements. |
| Nominal GDP | The total value of goods and services produced in an economy measured at current market prices. Nominal GDP does not account for inflation or deflation. |
| Negative Externalities | Unintended and undesirable side effects of economic activities affecting third parties not directly involved. Examples include pollution and noise. |
| Net Exports (NX) | The difference between a country’s exports and imports of goods and services, indicating a trade surplus or deficit. |
| Nash Equilibrium | In game theory, the Nash equilibrium is the solution of a non-cooperative game involving two or more players. Named after John Forbes Nash Jr., in a Nash equilibrium, each player knows the equilibrium strategies of others, and no player gains by changing only their strategy. |
| Normal Good | A good for which demand increases as consumer income rises. |
| Neoclassical Economics | A school of economic thought emphasizing rational decision-making, market equilibrium, and efficiency of free markets. Associated with marginal analysis and utility maximization. |
| Natural Rate of Unemployment | The level of unemployment that exists in an economy when it is operating at full capacity. It includes frictional and structural unemployment but excludes cyclical unemployment. |
| Nondurable Goods | Consumer goods with a short lifespan, typically used up or consumed in a short period. |
| Normal Distribution | A statistical distribution characterized by a bell-shaped curve. Most observations cluster around the mean, and the probability of extreme values decreases symmetrically. |
| Nominal Interest Rate | The interest rate stated in current dollars, without adjusting for inflation. |
| National Income | The total income earned by a country’s residents, including wages, profits, rents, and taxes, minus subsidies. |
| Natural Rate of Growth | The sustainable rate at which an economy can grow over the long term without causing inflation or deflation. |
| Net Investment | The difference between gross investment and depreciation. Measures the increase in a country’s capital stock. |
| Non-Tariff Barrier | Any trade barrier other than a tariff that restricts the flow of goods and services between countries. |
| Normal Profit | The minimum level of profit required to keep a firm in operation, covering both explicit and implicit costs. Represents the opportunity cost of the entrepreneur’s time and capital. |
| Non-Recourse Loan | A loan where the lender’s only recourse, in the event of default, is to seize the collateral. The borrower is not personally liable for any additional amounts beyond the value of the collateral. |
| Nonprofit Organization | An organization that operates for purposes other than profit, such as charitable, educational, or social goals. |
| Nondiscrimination Principle | A principle in international trade requiring treating foreign and domestic products equally, a key element of the most-favored-nation (MFN) clause in trade agreements. |
| Nash Bargaining Solution | A solution concept in cooperative game theory predicting the outcome of negotiations between two parties based on equal marginal product of effort. |