Limitgleichgewichts

Limitgleichgewichts is a concept within the field of economics, specifically within the realm of macroeconomic theories. The term itself is a German phrase, with "Gleichgewichts" signifying equilibrium and "Limit" meaning limit or boundary. It was first introduced by the German economist Franz Oppenheimer in the early 20th century.

In essence, a Limitgleichgewichts is an economic state in which the demand for a particular product or service reaches the upper or lower limit of the supply curve, ultimately resulting in the product or service becoming either extremely scarce or extremely abundant. This paradoxical situation is indeed unconventional, as an economy typically operates within a range of stable equilibrium, with supply and demand being balanced.

The concept of Limitgleichgewichts highlights the importance of marginal economic conditions under which normal economic behavior is disrupted. When consumer demand for a product surpasses its production capacity, or when its supply exponentially increases beyond expected demand, appropriate adjustments must be made to revitalize balance in the market. This can involve shifting production, pricing strategies or through utilitarian rationing of limited offerings. Limitgleichgewichts offers perspective on stressful economies undergoing instability.