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Overproduction in the economy a production volume that on a market existing demand exceeds permanently.


In the economy, overproduction describes the production of goods that exceeds demand (excess supply ). This creates a disproportion between the actual demand and its coverage . For the consumer , this situation can have the pleasant consequence of price reductions. For companies or possibly entire branches of industry , this can have fatal consequences , at least in the free market economy . In the best case, the problem of a lack of demand can be solved by means of price reductions or marketing or advertising measures , which, however, lead to profit reductions or even losses. In the worst case, some of the goods cannot be sold. Perishable goods can no longer be sold after a certain period of time. Many unsalable goods cause disposal costs . Sometimes the revenues that can be generated from the scrap exceed the disposal costs; they are then still for sale because of their raw material value.

Overproduction is related to the price elasticity of demand . Here are two examples:

  • If the potato price halves, then - at least in wealthy industrialized countries - demand hardly rises (“low price elasticity of demand”). This is also due to the fact that potatoes only have a limited shelf life and require a relatively large amount of space.
  • With some other products this is different - here buyers are ready to take advantage of cheap prices. For example, when heating oil prices are relatively low, many consumers take the opportunity to fill their oil tanks; At high prices, on the other hand, they only fill them with the amount they need during the heating season.

Planned economy

The difficulty with a planned economy is that, at least with the technical possibilities of the past, it was hardly possible to centrally record all the needs of the entire population in advance and to calculate the upcoming needs correctly and to trigger suitable central control processes. In addition, there is usually a lack of coordination of production capacities in a value chain in a central administration economy . These are factors that in a planned economy can not only lead to shortages, but also to overproduction in some cases.

The “Common Agricultural Policy of the EU” was also a planned economy for decades. It cost a lot of money (subsidies) and led to overproduction, e.g. B. Butterberg , Milchsee and Weinsee. In principle, a planned economy can also occur within private companies and lead to comparable problems in their economic sphere of influence.

Market economy

In the free market economy , the state of overproduction arises in different ways:

  • Competition : There is a lack of supply of a product, and several companies decide independently to resume production of this product. As a result, the companies have to share demand to a certain extent or try to stimulate additional demand through oversupply, advertising campaigns and price dumping. Since existing competition is the norm in the free market economy, these forms of overproduction are deliberately used in the hope of taking market share from the competition or at least maintaining their own market shares. Overproduction can lead to ruinous competition under certain circumstances .
  • Misjudgment : A company misjudges the actual demand due to insufficient market analysis and in this case unintentionally produces more than it can actually sell.
  • Rising operating and maintenance costs of the product. For example, rising energy prices have led to sales problems and slumps in profits for various automakers in the USA . The more expensive complementary product petrol makes cars with high consumption unattractive for the consumer and the demand falls.


The term overproduction is probably best known in connection with agricultural products . State subsidies created false incentives and thus led to overproduction of agricultural goods. At the end of the 1970s , this resulted in the creation of Butterberg , Milchschwemme and Weinsee , collectively referred to as “agricultural surpluses” ( excess supply ; see German agricultural exports and the EU's common agricultural policy ).


The term overproduction is probably most frequently used in discussions about the advantages and disadvantages of the individual economic systems , especially in the debate about the planned economy or the free market economy . The fact is that overproduction can occur in both systems. On the one hand, it is assumed that the market economy can react more quickly, which z. B. plant closures, layoffs, etc. can result. On the other hand, it can be assumed that in a market economy, due to the lack of central regulation, overproduction occurs far more frequently than in a centralized planned economy. Which of the two effects is more significant is the subject of controversy. The fact is that twentieth-century socialism tended to be characterized by excess purchasing power and western capitalism by excess supply, which indicates the existence of overproduction in the latter case. Not least for this reason, the term overproduction, also called overproduction crisis, is often brought up in the context of the criticism of the free market economy .

Overproduction theory

The overproduction theory is a Marxist business cycle theory that assumes that an incessant capitalist mechanization process permanently releases human labor ( industrial reserve army ; see also underconsumption theory ). In view of the growing number of exploitative workers, the improved product can not be sold (overproduction), so that subsequent economic crises lead to the “ expropriation of the expropriators”. Karl Marx's term can better be replaced by over-accumulation or over-investment theory .

See also

Individual evidence

  1. Th. Gabler Verlag (ed.), Gablers Wirtschafts-Lexikon , Volume 6, 1984, Sp. 1676.
  2. Th. Gabler Verlag (ed.), Gablers Wirtschafts-Lexikon , Volume 6, 1984, Sp. 1676.
  3. ^ Karl Georg Zinn, Political Economy: Apologies and Criticisms of Capitalism , 1987, p. 161 .