Asset substitution effect: As debt-to-equity ratio increases, management has an incentive to undertake risky, even negative Net present value(NPV) projects.
在消费层次和生产层次,往往会出现一种替代效应,这是价格上升会蔓延到其他作物的原因之一。
There is often a substitution effect at both the consumption and the production levels, which is one reason why price increases spread to other crops.
Nike之类的美国品牌在亚洲都有生产,并不只在中国,因此会出现替代效应。
Big US consumer brands like Nike produce in all of Asia, not just in one country, so there will be a substitution effect.”.
其次,价格上涨的收入效应和替代效应导致福利减少。
(2) The income effect and substitution effect of rising prices lead to a decrease in welfare.
如果商品是吉芬商品,那么收入效应不仅为负数,而且其程度足以抵消替代效应。
In case of Giffen good, income effect is not only negative but also much stronger than the substitution effect.
The substitution effect might explain why Business for a Fair Minimum Wage, a national network of business owners and executives, argues for higher minimum wages.
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