Economic Surplus
By economic surplus is meant all production which is not essential for the continuance of existence. That is to say, all production about which there is a choice as to whether or not it is produced. The economic surplus begins when an economy is first able to produce more than it needs to survive, a surplus to its essentials. This definition is no more arbitrary than defining all resources as scarce by definition by declaring all wants infinite. In fact it is much less so since the line between existence and non-existence is a real one. This is different to the standard use of the term surplus in economics.
Alternative definitions are:
- The difference between the value of a society's annual product and its socially necessary cost of production. (Davis, p.1)
- The range of economic freedom at its disposal, extent able to engage in socially discretionary spending that satisfies more than the basic needs of its producers. (Dawson & Foster in Davis, p.45)
- Income minus essential consumption requirements. (Lippit in Davis p.81)
- The difference between what a society can produce and what a society must produce to reproduce itself. (Standfield in Davis, p.131)
Read more about this topic: Surplus Economics
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