Left graphPer-unit tax on sellers Per-unit subsidy to producers Price of a substitute rises Price of a complement rises Input cost shock (single market) Rising incomes lift demand for a normal good New technology makes production cheaper Central bank cuts interest rates Central bank raises interest rates Income tax cut Income tax increase Government stimulus spending Government austerity Consumer confidence collapse Export boom Currency depreciation Housing / stock market wealth boom Oil price shock Global supply chain disruption Technology / productivity boom Minimum wage increase Immigration-driven labor force growth Major natural disaster Energy price collapse Tariff war Inflation expectations rise (wage-price pressure) Technology boom in one industry Broad economic growth War destroys capital Technology raises productivity Skilled migration expands the workforce Recession cuts labor demand Government runs a big deficit A global savings glut arrives Investment optimism surges Central bank expands the money supply Emergency tightening Economic boom raises money demand Panic sends everyone rushing for cash Tap-and-go cuts the cash people need to hold The central bank buys bonds and eases rates Higher reserve requirements drain the money supply Fiscal stimulus package Central bank easing Investment confidence collapses Inflation expectations de-anchor Labor market reform cuts the NAIRU Oil shock drags the whole tradeoff upward Central bank credibility pulls expectations down Better job matching lowers the natural rate Long-term unemployment scars the workforce Wage-price spiral un-anchors expectations Stimulus meets the multiplier The paradox of thrift Consumers spend a bigger share An infrastructure program multiplies through Austerity contracts income by a multiple Fear makes households save each extra dollar An export boom injects demand from abroad A national savings drive Technology leaps forward Population growth accelerates Demand boom for the monopolist Marginal cost rises Fixed costs jump (rent doubles) Demand slumps and the monopolist retreats Cheaper inputs let the monopolist expand A licence fee hits profit but not price An efficiency drive cuts overheads Demand becomes inelastic (addictive good) Supply becomes highly elastic Demand boom (compare elasticities) Rivals arrive and demand turns elastic Capacity is fixed, so supply turns inelastic Budgets tighten but the necessity still sells Incomes rise and demand for the luxury jumps A tax shrinks the pie Demand boom grows total surplus Cheaper production shifts the split A production subsidy expands the gains from trade A demand slump shrinks the surplus triangles Cheap imports flood in and buyers capture the gains A supply disruption destroys gains from trade Industry price rises Entry competes profit away Input costs rise for every firm Rivals flood in Successful rebranding A carbon tax is introduced The pollution turns out worse Demand boom for a polluting good Cleaner technology shrinks the external cost A dirtier process widens the external cost Weak demand accidentally cuts the pollution An industrial boom magnifies the market failure The printing press runs The real economy grows Markets expect higher inflation The neutral real rate declines Fiscal expansion under floating rates Monetary easing under floating rates The Fed raises the world rate Inflation spikes to 8% The central bank raises its target Market demand expands Firm 1's costs jump Hiring freezes in a recession A layoff wave hits Workers gain outside options Worker productivity rises Job platforms improve matching A hiring boom (moving along the curve) A plague strikes An agricultural revolution The risk-free rate rises Fear grips the market A firm levers up (beta rises) Interest rates spike Your spending doubles The deadline gets close You adopt a commitment device Framing a change as a loss Diminishing sensitivity at scale A trade agreement is signed Pivoting to a distant partner Domestic inflation outpaces the world Foreign prices surge instead Home has a manufacturing technology leap Drought devastates Foreign's wine harvest Foreign invests in education and catches up Drought shrinks what the home country can make Skills investment pushes the home frontier out The trading partner industrialises fast Conflict abroad shrinks the partner's capacity Donations collapse as free-riding spreads A pandemic raises the value of mass vaccination New technology slashes the cost of provision Government introduces fishing licence fees Cheap sonar makes every boat more effective Years of overfishing halve the stock You get a solid pay rise Your go-to good doubles in price A recession cuts household income Investor funding doubles the production budget A sector-wide pay deal lifts labour costs Your employer offers time-and-a-half overtime A universal basic income is introduced Welfare payments are cut A mining boom lifts wages for school leavers A tech boom raises the graduate premium Credential inflation erodes the degree premium The home central bank surprises with a rate hike The Fed hikes while home stands still Speculators start expecting the currency to slide The central bank starts a hiking cycle Recession fears invert the yield curve Quantitative easing compresses long yields QE floods the banking system with base money A banking panic makes banks hoard reserves Tap-to-pay wipes out cash hoarding A national saving campaign lifts the saving rate A heavy-industry push raises the capital-output ratio A baby boom raises the natural growth rate R&D tax credits supercharge the idea machine Compulsory superannuation lifts national saving A brain drain hollows out the knowledge base A financial crisis rips through demand Massive stimulus overheats the economy A technology revolution lifts trend growth A pandemic slams the economy below trend Pent-up spending pushes output above capacity A productivity slowdown flattens the trend An export-led recovery closes the gap A war deficit is handed to the printing press Citizens flee the currency for dollars A stabilization program slashes the deficit Controlling for ability flattens the slope A data-entry error plants a wild outlier One state raises its minimum wage (Card-Krueger) A tech boom lifts employment everywhere Five more bidders join the auction The item turns out to be worth more to you A bidding ring quietly colludes Vehicle history reports go mainstream Mandatory warranties reassure buyers An odometer-fraud scandal torches trust The pass mark gets harder for everyone Universal prep courses make success easier You evaluate higher up the score range Trade opening speeds technology transfer Institutional collapse blocks catch-up AI accelerates growth at the frontier Tech boom concentrates income at the top Progressive tax and transfer reform Rates pushed past the revenue peak Supply-side tax cut toward the peak Crackdown on avoidance and evasion Sharp currency depreciation hits Exporters respond unusually fast Government imposes a tariff Free trade agreement removes the tariff World price collapses (global glut) A trade war escalates the tariff The world price spikes and imports get dear Domestic producers get competitive Local industry decays and imports fill the gap
Right graphPer-unit tax on sellers Per-unit subsidy to producers Price of a substitute rises Price of a complement rises Input cost shock (single market) Rising incomes lift demand for a normal good New technology makes production cheaper Central bank cuts interest rates Central bank raises interest rates Income tax cut Income tax increase Government stimulus spending Government austerity Consumer confidence collapse Export boom Currency depreciation Housing / stock market wealth boom Oil price shock Global supply chain disruption Technology / productivity boom Minimum wage increase Immigration-driven labor force growth Major natural disaster Energy price collapse Tariff war Inflation expectations rise (wage-price pressure) Technology boom in one industry Broad economic growth War destroys capital Technology raises productivity Skilled migration expands the workforce Recession cuts labor demand Government runs a big deficit A global savings glut arrives Investment optimism surges Central bank expands the money supply Emergency tightening Economic boom raises money demand Panic sends everyone rushing for cash Tap-and-go cuts the cash people need to hold The central bank buys bonds and eases rates Higher reserve requirements drain the money supply Fiscal stimulus package Central bank easing Investment confidence collapses Inflation expectations de-anchor Labor market reform cuts the NAIRU Oil shock drags the whole tradeoff upward Central bank credibility pulls expectations down Better job matching lowers the natural rate Long-term unemployment scars the workforce Wage-price spiral un-anchors expectations Stimulus meets the multiplier The paradox of thrift Consumers spend a bigger share An infrastructure program multiplies through Austerity contracts income by a multiple Fear makes households save each extra dollar An export boom injects demand from abroad A national savings drive Technology leaps forward Population growth accelerates Demand boom for the monopolist Marginal cost rises Fixed costs jump (rent doubles) Demand slumps and the monopolist retreats Cheaper inputs let the monopolist expand A licence fee hits profit but not price An efficiency drive cuts overheads Demand becomes inelastic (addictive good) Supply becomes highly elastic Demand boom (compare elasticities) Rivals arrive and demand turns elastic Capacity is fixed, so supply turns inelastic Budgets tighten but the necessity still sells Incomes rise and demand for the luxury jumps A tax shrinks the pie Demand boom grows total surplus Cheaper production shifts the split A production subsidy expands the gains from trade A demand slump shrinks the surplus triangles Cheap imports flood in and buyers capture the gains A supply disruption destroys gains from trade Industry price rises Entry competes profit away Input costs rise for every firm Rivals flood in Successful rebranding A carbon tax is introduced The pollution turns out worse Demand boom for a polluting good Cleaner technology shrinks the external cost A dirtier process widens the external cost Weak demand accidentally cuts the pollution An industrial boom magnifies the market failure The printing press runs The real economy grows Markets expect higher inflation The neutral real rate declines Fiscal expansion under floating rates Monetary easing under floating rates The Fed raises the world rate Inflation spikes to 8% The central bank raises its target Market demand expands Firm 1's costs jump Hiring freezes in a recession A layoff wave hits Workers gain outside options Worker productivity rises Job platforms improve matching A hiring boom (moving along the curve) A plague strikes An agricultural revolution The risk-free rate rises Fear grips the market A firm levers up (beta rises) Interest rates spike Your spending doubles The deadline gets close You adopt a commitment device Framing a change as a loss Diminishing sensitivity at scale A trade agreement is signed Pivoting to a distant partner Domestic inflation outpaces the world Foreign prices surge instead Home has a manufacturing technology leap Drought devastates Foreign's wine harvest Foreign invests in education and catches up Drought shrinks what the home country can make Skills investment pushes the home frontier out The trading partner industrialises fast Conflict abroad shrinks the partner's capacity Donations collapse as free-riding spreads A pandemic raises the value of mass vaccination New technology slashes the cost of provision Government introduces fishing licence fees Cheap sonar makes every boat more effective Years of overfishing halve the stock You get a solid pay rise Your go-to good doubles in price A recession cuts household income Investor funding doubles the production budget A sector-wide pay deal lifts labour costs Your employer offers time-and-a-half overtime A universal basic income is introduced Welfare payments are cut A mining boom lifts wages for school leavers A tech boom raises the graduate premium Credential inflation erodes the degree premium The home central bank surprises with a rate hike The Fed hikes while home stands still Speculators start expecting the currency to slide The central bank starts a hiking cycle Recession fears invert the yield curve Quantitative easing compresses long yields QE floods the banking system with base money A banking panic makes banks hoard reserves Tap-to-pay wipes out cash hoarding A national saving campaign lifts the saving rate A heavy-industry push raises the capital-output ratio A baby boom raises the natural growth rate R&D tax credits supercharge the idea machine Compulsory superannuation lifts national saving A brain drain hollows out the knowledge base A financial crisis rips through demand Massive stimulus overheats the economy A technology revolution lifts trend growth A pandemic slams the economy below trend Pent-up spending pushes output above capacity A productivity slowdown flattens the trend An export-led recovery closes the gap A war deficit is handed to the printing press Citizens flee the currency for dollars A stabilization program slashes the deficit Controlling for ability flattens the slope A data-entry error plants a wild outlier One state raises its minimum wage (Card-Krueger) A tech boom lifts employment everywhere Five more bidders join the auction The item turns out to be worth more to you A bidding ring quietly colludes Vehicle history reports go mainstream Mandatory warranties reassure buyers An odometer-fraud scandal torches trust The pass mark gets harder for everyone Universal prep courses make success easier You evaluate higher up the score range Trade opening speeds technology transfer Institutional collapse blocks catch-up AI accelerates growth at the frontier Tech boom concentrates income at the top Progressive tax and transfer reform Rates pushed past the revenue peak Supply-side tax cut toward the peak Crackdown on avoidance and evasion Sharp currency depreciation hits Exporters respond unusually fast Government imposes a tariff Free trade agreement removes the tariff World price collapses (global glut) A trade war escalates the tariff The world price spikes and imports get dear Domestic producers get competitive Local industry decays and imports fill the gap