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Denison residual (04)<br />Advances in knowledge and associated causes of economic growth. Denison discovered this important growth determinant in his study of the USA and eight West European countries for the period 1950-62.<br /><em>Reference</em><br />Denison, E.F (1967) Why Growth Rates Differ, ch. 20, Washington, DC: Brookings Institution.
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optimal work effort (J2)<br />The amount of work which equates the MARGINAL UTILITY of an hour's work with the marginal utility of another hour's leisure.
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Lerner effect (E2)<br />An upward shift in the CONSUMPTION FUNCTION caused by an increase in the level of money or public debt claims, leading to a FULL-EMPWYMENT equilibrium JeveJ of public debt.<br /> <br /><em>Reference</em><br />Lerner, A.P (1948) 'The burden of the national debt', in Income, Employment and Public Policy- Essays in Honour of AlvinH Ransen, NewYork:WWNorton.
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commodity reserve currency (F3)<br />A currency with a value based on a 'basket' of commodities representative of average consumption. This currency tends to be stable over time, as happened under the GOLD STANDARD, and can take a variety of forms reflecting the technical characteristics of commodities at a particular time and the desired level of stability. However, it has been argued that few commodities are suitable for inclusion in the 'basket', e.g. on account of storage difficulties, but using commodity futures could eliminate many of these problems.<br /><em>Reference</em><br />Friedman, M. (1953) Essays in Positive Economics, pp. 204-50, Chicago: University of Chicago Press.
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A graduate in mathematics, engineering and economics from Arizona, Oklahoma, Virginia and Harvard Universities. Professor at Harvard from 1965 to 1970 and from 1983; economic adviser to the president of the woRLD BANK in 1970-2 and the bank's vice-president in charge of development policies in 1972-82. His quantitative approach to DEVEWPMENr Eco. NOMlcs views self-sustaining economic growth as a function of industrialization, which is itself associated with a switch from agricultural to industrial products in the commodity structure of a coun try's exports. In 1959, he published a widely used INPUT OUTPUT text. He collaborated with ARROW and others in 1961 to produce the CONSTANr ELASTICITY OF SUBSTITUTION PRQ. DUCTION FUNCTION which substan tially replaced the popular COBB DOUGLAS PRODUCTION FUNCTION.<br /><em>Reference</em><br />Arrow, K.J., Chenery, H.B., Minhas, B.S. and Solow, R.M. (1961) 'Capital-labour substitution and economic efficiency', Review of Economics and Statistics 43: 225-50.<br /> Chenery, H.B. and Clark, P. (1959) Int erindustry Economics, New York: Wiley.

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<strong>Rescheduling a disbursement</strong> – A pre-disbursement change transaction updating the date loan funds should be issued to the school or escrow agent. Within CommonLine 4 files, this transaction is referred to as a disbursement date change and is located within the @1-09 record.

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job seeker's allowance (J6)<br />A welfare payment to an unemployed person. It can be related to income and savings, or to accumulated contributions. This was introduced in the UK in October 1996 in succession to unemployment benefit and income support. It is so called because the qualification for being an unemployed member of the labour force, rather than a non-participant, is job search activity.

checking account (G2)<br />A US commercial bank deposit available for immediate use by the writing of a check (cheque). These deposits are part of the Ml money supply: until 1980 they did not bear interest. In the UK, they are known as CURRENT ACCOUNTS.<br /><em>See also:</em> Depository Institutions Deregulation and Monetary Control Act 1980; NOW account
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<strong>Enrolled</strong> – The status of a student who has been admitted to an educational program or has completed an institution' s registration requirements.

<strong>Mapping Your Future (MYF) Online Stafford Exit Counseling Leaflet</strong> – A guide to completing student loan exit counseling online through Mapping Your Future, This publication and all publications published by the MDHE can be requested on the Publications Order Form: http://www.dhe.mo.gov/publicationsorderform.shtml

market prices (E3)<br />A valuation of the NATIONAL INCOME that includes indirect taxes net of subsidies.<br /><em>See also:</em> factor cost; gross national product

pension fund (G2)<br />The accumulated contributions of an employer and employees of a firm, or other employing organization, which are used to finance the future payment of retirement pensions. In the UK, the largest funds are those of the long-established public corporations, major private sector firms and local governments. Pension funds since 1945 have become major INSTITUTIONAL INVESTORS with the potential to have a great influence on the movement of share prices.
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histogram (C1)<br />A method of presenting a FREQUENCY ms. TRIBUTION graphically in a number of rectangles varying in size according to the number of observations in each class; see the figure.
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optimum population (Jl)<br />An ideal-sized population that maximizes output per head. As this is not the maximum-sized population that a country can support, the population can exceed such an optimum. Critics of this concept have noted that there is no consensus support-
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<strong>NASFAA</strong> – National Association of Student Financial Aid Administrators.

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second economy (P4)<br />The market-oriented part of a socialist economy run by private persons. It can be legal or illegal; increasingly, private enterprise has been permitted in the service sector in Eastern Europe.<br /><em>See also:</em> first economy <br /><em>Reference</em><br />Grossman, G (1977) 'The second economy of the USSR', Problems of Communism 26: 25-40.
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so further Congressional approval is needed to make some public spending changes.<br /><em>See also:</em> earmarking; ringfencing

advance (GO)<br />A bank loan or an overdraft which has a term of less than three years, usually less than one year. When a bank creates money, it does so by allowing advances to its customers, i.e. permitting them to draw on the extra bank deposits created for them. An overdraft is a permission to 'overdraw' up to a certain amount for a specified period, but a loan results in an immediate crediting of the borrower's account.

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zero population growth (Jl)<br />The goal of many twentieth-century disciples of MALTHUS usually taking the form of advocating birth controL In many West European countries the use of contraceptive pills since the 1960s has brought the natural rate of increase below the replacement leveL<br /><em>See also:</em> neo-Malthusians
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non-rubber footwear, safety measures on colour TVs and CB radios, and the EUROPEAN coMMUNITY's import restrictions in 1981 on steel from Korea. The GENERAL AGREEMENT ON TARIFFS AND TRADE approximately measures the extent of the application of restrictive measures as the ratio of restricted imports/total imports. This measure is imprecise as a restriction will affect the total flow of imports. Non-tariff barriers can also be measured by calculating restricted imports as a share of the total consumption of manufactured goods, or consumption of restricted manufactured goods as a share of the total consumption of manufactured goods_<br /><em>See also:</em> protection; tariff

discrimination (J7)<br />1 Unfair and unfavourable treatment of a group of workers or other persons.<br /> 2 Setting different wages for workers with the same productivity but different personal characteristics, i.e. ######, age or race, or refusing to hire them.
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fixed cost (DO)<br />A cost to an enterprise which is incurred even when that enterprise's output is zero. These costs occur in the short run. The principal examples of them are equipment COStS and the COStS of FACTORS OF PRODUCTION which a firm has contracted to pay for a minimum period of time, e.g. managerial staff. In the long term, all costs become variable as fixed capital can be changed and contracts revised.<br /><em>See also:</em> average total cost; circulating capital; human capital; quasi-fixed factor; variable cost
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price-offer curve (DO)<br />Another name for the PRICE CONSUMPTION CURVE.<br /> price perception (DO)<br />Awareness of an actual price relative to other prices. When units of a currency are changed, e.g. through DECIMALIZATION or through many price changes in a period of general INFLATION, consumers are often unable to understand what price is being stated.<br /><em>See also:</em> money illusion

Industrial Reorganization Corporation (L5)<br />The UK state-financed financial institution in existence from 1967 to 1971 with the aim of restructuring UK industry. It provided finance to bring about desirable mergers between firms so as to make them more internationally competitive, British Leyland being one of its more famous cases. Also, it invested directly in several high-technology firms. The subsequent Conservative government abolished it because of its belief that government-financed bodies should not be engaged in risky investment activities.<br /><em>See also:</em> National Enterprise Board <br /><em>Reference</em><br />Hague, D.C. and Wilkinson, G.C.G. (1983) The IRC - An Experiment in Industrial Intervention: A History of the Industrial Reorganization Corporation, London: Allen & Unwin.
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boom of the 1830s and 1840s, the third, based on steel, machine tools and motor vehicles, which came to an end in the 1970s and the fourth, which is now taking place, based on electronics and biology. A disruptive feature of the fourth is the use of robots to replace workers in manufacturing, creating unpredictable and undesired employment effects.<br /><em>See also:</em> Kondratieff cycle; take-off <br /><em>Reference</em><br />Deane, P. (1979) The First Industrial Revolution, 2nd edn, Cambridge: Cambridge University Press.<br /> Rostow, WW (1971) The Stages of Economic Growth: A non-communist manifesto, Cambridge: Cambridge University Press.
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bonding cost (M2)<br />The cost to an agent of putting up a BOND as a guarantee to meet losses. Bonding is common amongst travel agents and insurance underwriters.
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<strong>MYF</strong> - Mapping Your Future, an organization sponsored by FFEL Program participants, such as the MDHE, to offer online student loan counseling, financial literacy and debt management tools, outreach and early awareness activities, and other services. May be found on the world wide web at www.mapping-your-future.org.

<strong>GED</strong> – General Educational Development certificate, an equivalent of a high school diploma. (See also “Ability to benefit.” )

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<strong>NCHELP</strong> – National Council of Higher Education Loan Programs, the FFEL Program national association for guarantors and secondary markets. NCHELP provides tools, manuals, documents, and resources online, including the Code of Federal Regulations (CFR). Visit the NCHELP e-library at www.nchelp.org.

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<strong>Clock hour</strong> – A time period consisting of one of the following: 50-60 minutes of class, lecture, or recitation; 50-60 minutes of faculty supervised laboratory, shop training, or internship; or 60 minutes of preparation for a correspondence course.

<strong>A+ Schools Program</strong> – A program administered by the Missouri Department of Elementary and Secondary Education (DESE) which provides paid tuition and fees as well as other financial incentives for students who fulfill needed requirements, graduate from a designated A+ high school and who attend a Missouri community college or vocational-technical school. More information is available at: http://www.dese.mo.gov/divimprove/aplus/index.html.
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<strong>Administrative forbearance</strong> – A temporary suspension, reduction, or time extension for making principal and/or interest payments on a FFEL Program loan. During any period of forbearance, interest continues to accrue on the loan.
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error-correction model (C5)<br />An econometric method of adjusting a policy instrument to keep a target variable close to its desired value used as early as 19 54 by PHILLIPS.<br /> <br /><em>Reference</em><br />Salmon, M. (1982) 'Error correction me- chanisms', Economic Journal92: 615-29.

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<strong>Repayment start date</strong> – the date the repayment period begins. For Stafford Loans, the repayment period begins on the day following the last day of the grace period. For PLUS Loans, repayment begins on the date the loan is fully disbursed. (PLUS Loans are, however, eligible for an in-school deferment when the borrower is enrolled at least half time.)

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funding (H6)<br />Conversion of short-term debt to longterm debt. Before governments had control over CENTRAL BANKS, funding was seen as a means of protecting a treasury against a short-term collapse of confidence in government securities leading to heavy sales of TREASURY BILLS and GOVERNMENT BONDS. Funding can also be practised by a firm, e.g. it can raise cash to pay off shortterm liabilities such as bank loans by issuing shares, thereby lengthening its debt.
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autarky (PO)<br />1 Self-sufficiency.<br /> 2 A completely closed economy which does not engage in international trade. Although many economies have wanted such independence from the rest of the world to increase employment, their enthusiasm has been tempered by an examination of the other effects of protection.<br /><em>See also:</em> utopia
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information externality (D8)<br />The supply of a PUBLIC GOOD by a private individual; for example, the activity of a pioneer that indicates to successors whether a venture is worthwhile.
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Eurocurrency market (G2)<br />The international market dealing in bank deposits in the major currencies, including the US dollar, yen, Deutschmark, Swiss franc, French franc, guilder and ecu, which has been in existence since the 19 50s. Its early growth was stimulated by REGULATION Q which encouraged the expatriation of US dollars in search of higher interest rates.
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eftpos (G2)<br />Electronic funds transfer at point of sale, i.e. automatic debiting of customers' bank or credit card accounts. This is the major method of introducing the cashless society but unlikely to replace the present variety of payment methods.<br /><em>See also:</em> debit card

Standard Statistical Metropolitan Area (J4)<br />An urban area of the USA. This concept was used until June 1963 when it was replaced by the METROPOLITAN STATISTICAL AREA.

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<strong>PL</strong> – 1) Loan type within CommonLine file specifications for a parent PLUS loan (as opposed to a Graduate PLUS loan, which has a loan type of “GL” ). 2) Public Law. For example, the public law associated with the HERA is PL 109-171.
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<strong>CBA</strong> – Consumer Bankers Association.

<strong>Reaffirmation</strong> – A borrower' s acknowledgment of a loan repayment obligation, including all principal, interest, and other costs, in a legally binding manner.

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P-star model (E3)<br />A model based on the QUANTITY THEORY OF MONEY and the belief that a price level tends to its equilibrium leveL It is used to forecast inflation by calculating the gap between the current price and the equilibrium price (P-star, P*). This equilibrium price is determined by potential output, the quantity of money in the ECONOMY and the equilibrium VELOCITY OF MONEY. If the equilibrium price is more than the current price, there is the possibility of inflation.
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<strong>R record</strong> – Response record, a record type included in CommonLine response files. An “R record” is sent to the original source of a change transaction send file.

ex post variables (EO)<br />Variables which show actual econom1c outcomes, e.g. the amount of fixed investment which has been undertaken. In the 1930s there was much discussion in macroeconomics of how ex ante savings and investment that were different in amount became equal ex post. One possibility was for there to be saving at each round of income generated from an ex ante investment excess over ex ante saving.<br /><em>See also:</em> ex ante variables

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Pacific Rim (00)<br />The thirty-four countries and twenty-three islands around the Pacific covering 70 million square miles (180 square kilometres) and consisting of 2.4 billion people (more than a half of the world's population). Since 1979 this world region has achieved more than half of the world's economic growth. Future prospects for growth around the Pacific are considerable as the combination of Japanese production, innovation and marketing methods harnessed to Chinese resources is formidable. References Daly, M.T. and Logan, M.I. (1989) The Brittle Rim, Harmondsworth: Penguin.

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<strong>GP</strong> – Guarantee and Print, a type of application process flow within the FFEL Program and outlined in CommonLine file specifications. In a “GP” process flow, the school submits loan application information to the guarantor for guarantee. After the loan is guaranteed, either a paper MPN is mailed to the borrower for completion or the application is made available online for the borrower to complete and sign.

regional multiplier (R1)<br />The number of times the income or employment of a region will multiply as a consequence of an increase in AUTONOMous EXPENDITURES.<br /> TWo approaches are often used: the economic base multiplier and the modified KEYNESIAN approach. The economic base approach assumes that regional income can be divided into two pa rts -what a rises from the BASIC IN DUSTRIES of the region and what springs from other regional industries. This multiplier is then calculated as I /(1 - s) with s the ratio of income earned in the non-basic sector to total regional income, i.e. the regional mul tiplier is<br />1 1 - ( 1 - t )( c - m )<br />with t the income tax rate, c the ma rginal propensity to consume and m the ma rginal propensity to import. There are many problems in calculating this multiplier, including the fact that basic industries may vary greatly in the extent to which they export to other regions. The KEYNESIAN approach merely applies a national multiplier formula to a region. A multiplier for a particular region is usually smaller than that for the national economy of which it is part as regions are more open, thus suffering from leakages of expenditures to other regions.<br /><em>See also:</em> multiplier
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Jurgensen Report (E5, F3)<br />A report to the World Economic Summit in Williamsburg, Virginia, in 1983 on central bank intervention in currency markets.
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National Association of Securities Dealers Automated Quotation System (G2)<br />US securities market founded in 1938 which lists over-the-counter securities not listed on regular exchanges. By the end of the 1980s, it became the second largest securities market in the USA and the third largest in the world, making it the strongest stock market in competition to the New York Stock Exchange, particularly because of its innovations in technology and market making. The price quotations of its MARKET-MAKERS are the basis of competition in this electronic market; each stock has a minimum of two marketmakers. From 1982, only stocks with at least 100,000 shares worth at least $5 each have been included, i.e. 2,500 stocks. It is also linked to the INTERNATIONAL STOCK EXCHANGE to provide a TRANSATLANTIC MARKET in 600 securities.<br /><em>See also:</em> over-the-counter market

<strong>MDHE Digest</strong> – The Missouri Department of Higher Education' s monthly electronic newsletter. To sign up for this publication, visit http://www.dhe.mo.gov/mdhedigest/signup.shtml.
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shortage economy (P4)<br />An economy characterized by EXCEss DEMAND for many goods and services for substantial periods of time. This often happens because prices of basic necessities are kept below their market clearing levels for welfare reasons. In a CENTRALLY PLANNED ECONOMY, there is a tendency to adhere to the same set of prices for many years, not raising them as demand rises. Also, if the prices set by a government reflect its priorities and not those of consumers excess demand can easily develop.<br /><em>See also:</em> Soviet-type economy
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inflation accounting (E3, M4)<br />Accounts measuring costs, revenue, profit and loss at constant prices. Major professional bodies of accountants have produced conventions to deal with the effects of inflation so that a true and accurate description of the financial state of an enterprise is achieved. The current cost approach is used in the UK, Australia, Canada and New Zealand. In the USA, the SECURITIES AND EXCHANGE COMMISSION requires large corporations to use the replacement cost approach, stating both specific price changes and movements in the general price index.<br /><em>See also:</em> current cost accounting; Sandilands Report <br /><em>Reference</em><br />Tweedie, D.P. and Whittington, G. (1984) The Debate on Inflation Accounting, Cambridge: Cambridge University Press.

administered inflation (E3)<br />INFLATION brought about by firms increasing the profit mark-up on their products; a form of COST-PUSH INFLATION.<br /><em>See also:</em> mark-up pricing
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dividend net (G2)<br />The rate of dividend paid in the last year, less income tax paid at the standard rate.

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