Absorption (economics)

In the context of monetary foreign trade theory , the part of national income and imports used for consumption and investment is referred to as absorption .

Since the difference between the total national income and the absorption is equal to the external contribution , there is an improvement in the external contribution z. B. as a consequence of a currency devaluation only if the absorption falls or rises less than the national income.

Absorption = expenditure of the economy = A = C + I + G,

where C = consumption, I = investment and G = government expenditure

The absorption corresponds to the national income only if the balance of the current account in the broader sense is zero. With an export surplus , the absorption is smaller than the national income.