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Dictionary definition: accelerator
- Article from:
- A Dictionary of Economics
- Author:
Copyright© A Dictionary of Economics 2002, originally published by Oxford University Press 2002. (Hide copyright information)
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accelerator
A model relating
investment
to changes in
output
. The accelerator model asserts that firms invest more when output is rising and less when it is falling. This seems reasonable: a rise in
demand
leads some firms to produce more, and leads them and other firms to expect that demand will rise further. ...