mitchell vitez

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The Ins and Ins of Economics

I’ve noticed a weirdly large number of econ terms start with the prefix in-, and thought that could make for a fun post. This is a brief, hopefully interesting, likely incorrect, and woefully incomplete survey of those terms.

In-kind

Payment given in a form other than cash

Incentives

The thing that explains, like, 99% of economic agents’ behavior

Income

The collective amount of payments you’ve received from others for pretty much any reason. Usually given with reference to some amount of time, e.g. “I made $X this year”

Incremental

A small change or improvement in some economic process (contrasted with inventions or innovations). Also refers to marginal cost, the cost per additional unit sold, but I’ve usually seen “marginal” instead of “incremental” for that

Index

A really general notion of a thing at one reference time that you can compare to at another time. Also index funds, which track a whole market vs. just one stock. Also refers to the consumer price index, calculated from a “basket of goods”.

Indifference

Let’s say you get exactly the same utility from X dollars and Y goods, or W dollars and Z goods. You’re indifferent to the two options. We can plot the curve of such points, and call it the indifference curve.

Industry

Businesses that produce goods. Sometimes just used to mean “manufacturing”. Also an important part of “Industrial Revolution”.

Inequality

The difference in the amounts of something held by different parties. Often referred to in the phrase “income inequality”. Measured with the Gini coefficient.

Inflation

Growth in price levels over time. Only really makes sense in macro. Some is usually taken to be good, hyper- is usually taken to be bad.

Influence

Not sure how this is different from power.

Innovation

The process of invention but also dissemination of the newly invented products/ideas. Usually higher levels lead to more economic growth.

Insolvent

What you are if you have more liabilities than you can pay for with your assets. Greece was famously this recently.

Instability

Fairly intuitive, but tracks with things like high levels of uncertainty, high variance in money supply, can lead to recessions etc.

Interest

The coolest way I heard this explained was that you’re shifting your buying power around in time, and need to pay interest/get to collect interest for doing so.

Invention

Making something new!

Inventory

A stockpile of goods, or just a stockpile of materials that could become goods.

Investment

Buying capital goods.