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A Comparative Analysis of the Effectiveness of Ceteris Paribus Assumption in Economic Models

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Weeraratne N.C.
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In general, an economist uses Ceteris Paribus assumption to explain the law of demand. Ceteris Paribus is Latin phrase and that generally used for saying “with other things being same or all other things remaining equal”. But this assumption is not valid for every case in the law of demand. So this paper explains how to use Ceteris Paribus assumption effectively. When the pairwise correlation between contributing factors of demand (price, income, …, etc.) is comparatively low , Ceteris Paribus assumption can use to yield a substantive isolation.

Weeraratne N.C.

Ceteris Paribus, Correlation, Demand Function

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Publication Details

Published in : Volume 2 | Issue 4 | July-August - 2016
Date of Publication Print ISSN Online ISSN
2016-08-30 2395-1990 2394-4099
Page(s) Manuscript Number   Publisher
506-509 IJSRSET1624115   Technoscience Academy

Cite This Article

Weeraratne N.C., "A Comparative Analysis of the Effectiveness of Ceteris Paribus Assumption in Economic Models", International Journal of Scientific Research in Science, Engineering and Technology(IJSRSET), Print ISSN : 2395-1990, Online ISSN : 2394-4099, Volume 2, Issue 4, pp.506-509, July-August-2016.
URL : http://ijsrset.com/IJSRSET1624115.php