substitutioonimäär

Substitutioonimäär is a term used in Finnish mathematics and economics that translates loosely to "substitution rate" or "rate of substitution." It describes the amount of one good or service that must be given up to obtain one additional unit of another good or service, while maintaining the same level of utility or satisfaction. This concept is particularly relevant in microeconomics when analyzing consumer choice and the shape of indifference curves.

In consumer theory, the substitution effect is a key component of the total effect of a price change. When the price of a good changes, consumers tend to substitute away from the relatively more expensive good towards the relatively cheaper one. The substitutionimäär quantifies this trade-off. For instance, if the price of apples decreases, a consumer might buy more apples and fewer pears, with the substitutionimäär indicating how many pears they are willing to forgo for each extra apple consumed.

The concept is also applicable in production theory. A firm might use different combinations of labor and capital to produce a certain output. If the price of labor increases, the firm may substitute some labor for capital, and the substitutionimäär would represent the rate at which capital can replace labor while keeping the output level constant. It is a measure of the marginal rate of technical substitution in this context. Understanding the substitutionimäär helps in analyzing economic behavior and predicting responses to changes in relative prices.