Multiplier (economics)

Multiplier (economics)

In economics, a multiplier is a factor of proportionality that measures how much an endogenous variable changes in response to a change in some exogenous variable.

For example, suppose variable x changes by 1 unit, which causes another variable y to change by M units. Then the multiplier is M.

Read more about Multiplier (economics):  General Method, History, Critiques