alitarjonnan

Alitarjonnan refers to a market condition in which the quantity supplied of a good or service is less than the quantity demanded at the prevailing price, resulting in a shortage. In Finnish economic literature the term denotes a shortage that persists when supply cannot respond quickly enough to rising demand. It is the counterpart to ylitarjonta, or excess supply.

Causes of alitarjonnan include price controls that keep prices below the equilibrium level, production bottlenecks, input shortages, regulatory constraints, and disruptions in global or regional supply chains. Seasonal variation and natural disasters can create temporary undersupply as well. Market power by dominant firms or monopolies may also limit output, while trade restrictions or sudden changes in exchange rates can reduce available supply.

The consequences include higher prices and temporary rationing, longer queues, and reduced consumer welfare. Persistently undersupplied markets may experience substitutions, the emergence of black markets, or increased investment in alternative sources and capacity. In essential sectors such as housing, energy, or medicines, undersupply can have wide-reaching social and economic costs.

Measurement and analysis of alitarjonnan are often indirect, inferred from price movements that do not reflect proportional increases in supply, or from reported shortages and waiting times. Policy responses aim to restore alignment between supply and demand, typically by allowing prices to adjust toward the market-clearing level, removing unnecessary restrictions, facilitating investment in productive capacity, or using public provision and strategic reserves to mitigate vulnerability.

See also: tarjonta, kysyntä, ylitarjonta, market equilibrium.