Accelerator effect

In economics, the acceleration effect is defined as the positive effect of market economic growth on private fixed investment, for example, compared with the total change in domestic output. More GDP makes society more prosperous as businesses see profits rise. This change manifests itself in an increase in sales and earnings that now maximizes the benefits of capacity. This usually manifests itself in desirable profits and an increase in the profits of the business. It also entices firms to build more factories and other buildings, spending known as fixed investment. In addition, it will attract more customers to consume, which is called the multiplier effect in economics. This change has an excellent improvement to the social economy.

Each company has specific strategies that aim to maximize the amount of money available(Yu Sandy,2020).[1] And not just smoothly changing from a different model of machine. This means that the goal of every company is to make more money, not just change machines and buildings. The concept of accelerator theory was developed by "Thomas Nixon Carver" and "Albert Aftalion" before Keynesian economics began to be implemented. Still, Keynesian theory became more and more famous in economics. Some people praised it. They opposed it because it was thought to eliminate all possibility of demand control through price control.

Acceleration can be wrong, too: the reduction and decline in GDP can be insufficient for corporate profits, sales, cash flow, productivity use and budgets. All this will depress fixed investment, causing the recession to come earlier through the multiplier effect.

The acceleration effect is the best social phenomenon when the economy is undergoing bad changes or is already below production (Jui-Chuan Chang, 2007).[2] This is because, in aggregate demand, all available Labour is at its highest level. At the same time, it is easier to get more money and natural resources. It is more conducive to the improvement and development of science and technology.

Compare the multiplier effect with the acceleration effect <! The opening paragraph is not quite right. Welcome to discuss on the discussion page. --> Acceleration is defined as the fact that a variable moves faster and faster toward its expected value relative to time. Usually, the variable is equity. Keynes model does not consider fixed capital, thus accelerating factor into the reciprocal of multiplier, capital degraded into investment decisions. In the more common theory, capital decisions determine the required level of capital stock (including fixed capital and working capital). It is then determined by investment decisions, the cycle of the sequence of changes in the capital stock. Accelerating effects occur when current and previous gaps affect current investments. The Aviation - Clarke accelerator V has one such form < math.h > I_ {t} \ \ sum_ mu v = {I = 1} ^ {infty} \ left (1 -), mu, right ^ {I} \ left (Y_ {I} t - - Y_ {t - I - 1}} \ right) < math.h >, and Keynesian multiplier m there is such a form < math.h > Y_ {t} = mI_ {t} = \ frac {1} {1} the MPC I_ {t} < math.h > where "the MPC is the marginal propensity to consume. Hayek has well explained the concept of an accelerator. In addition, Tamara Peneva Todorova and Marin Kutrolli (2019,368) argue that the emergence of the multiplier effect makes the Keynesian theory more convincing.[3] Imagine that when all the variables disappeared, taxes, imports, and so on, all the conclusions in multiplier theory were consistent with the Keynesian basis. At the same time, under the influence of the accelerator effect, whether the number of subjects is enlarged or reduced, the conclusion is not affected.