Market situation gain

The market situation profit or Q profit ( English windfall profit or windfall gain ) is a dynamic profit in economics , which leads to cost reductions due to sudden, extraordinary and unexpected changes in the market development or arises from unexpected additional demand .

history

The English economist David Ricardo already addressed sudden changes in the market situation in 1817. The comprehensive scientific description of the market situation can be traced back to Erich Preiser in the German-language specialist literature in 1955 . He called it, referring to John Maynard Keynes , also Q-profit (quasi-monopoly profit ). Keynes also describes the market situation gain as "windfall gains" and Preiser as "dynamic market situation gain". According to Preiser, it is one of the dynamic gains alongside the pioneer gain. Unlike the plannable pioneer profit, the market situation profit arises from unexpected or random market developments. Erich Preiser also calls it scarcity gain , which cannot be calculated with certainty. Gains in the market situation are therefore not based on the corresponding performance of the entrepreneur , but on sudden, extraordinary changes in the market situation .

causes

Economically, the scarcity gain arises when there is a positive difference between net investment and net savings , i.e. ${\displaystyle Q}$ ${\displaystyle I}$ ${\displaystyle S}$

${\displaystyle {\mbox{I}}>{\mbox{S}}}$, therefore

${\displaystyle {\mbox{I}}={\mbox{S}}+{\mbox{Q}}}$

In the opposite situation, one speaks of market situation losses . Both situations are based on an imbalance. With increasing demand (e.g. loss of a competitor , hamster purchases ) and short-term inelastic supply , price increases and / or longer delivery times occur, which increase the providers' sales , whereby the total costs initially remain the same. In the course of this multiplier process, the profit from the market situation increasingly decreases through adjustment processes until it finally disappears completely:

${\displaystyle {\mbox{Q}}={\mbox{0}}}$.

Then the market has found its new market equilibrium , and it applies

${\displaystyle {\mbox{I}}={\mbox{S}}}$.

Another example is profits from increasing the value of a property by converting it into building land or through public development measures . A second variant appears more frequently in business practice, namely cost reductions due to unexpectedly lower procurement prices such as raw material , operating and auxiliary material costs . If, for example, the price of oil and gasoline falls - with constant procurement volumes and sales - there is also a profit from the market situation. This explains the term “windfall” used by Keynes, which can be translated as “unexpected stroke of luck, unexpected gift”, because the development of oil prices cannot be influenced by companies and can hardly be foreseen and leads to random profits .

taxation

→ Main article : random profit tax

In the course of the oil price crisis in 1979 , oil- producing companies made market gains. In 1980, the Carter Cabinet introduced a Crude Oil Windfall Profit Tax in the United States . In 1988 this was abolished again.

In Great Britain in 1997 the Labor government imposed a windfall tax on privatized utility companies that held a monopoly , which was intended to skim off part of the profits that were regarded as disproportionately high.

The OECD criticized that a windfall tax often did not hit those who received the excessive profits because this group of people had already resold the shares in question.

Individual evidence

1. ^ David Ricardo, Principles of Political Economy and Taxation , 1817, p. 159
2. ↑ Erich Preiser, multiplier process and dynamic entrepreneurship , in: Journal of Economics and Statistics, Vol. 167, No. 2/3 (1955), pp. 89-126.
3. ^ John Maynard Keynes, A Treatise on Money , 1930, pp. 113 f.
4. ↑ Ullrich Schillert, Profits as a source of wealth policy? , 1976, p. 183
5. ↑ Erich Preiser, Education and Distribution of National Income , 1961, p. 159
6. ↑ Momtchil Michliachki, The Key Role of the German Electricity Industry in European Emissions Trading , 2009, ISBN 3868152504 , p. 24
7. ↑ Klaus Rose, Theory of Income Distribution , 1965, p. 79
8. ↑ Crude Oil Windfall Profit Tax Act (PL 96-223)
9. ^ ^{A b} Rebecca Strätling, The corporation in Great Britain in the course of economic policy. A contribution to the path dependency of company regulations , Lucius and Lucius, 2000, ISBN 3-8282-0128-8 , p. 134 f.