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Connected glossary
Learn a concept where it does real work.
Definitions become memorable when they unlock a live question. Every concept links back to the mechanisms that use it.
Access model
Paying for continued use rather than permanent ownership.
1 connected LeverAdjustment cost
The cost borne while workers, capital and places move between activities after trade patterns change.
1 connected LeverAgglomeration economy
Productivity gains firms receive by locating near related firms and workers.
1 connected LeverAggregate demand
Total spending on goods and services in an economy.
1 connected LeverAmmonia
A nitrogen compound used as the foundation for many fertilizers.
1 connected LeverAsset freeze
A prohibition on transferring or dealing with specified property under the sanctioning authority's jurisdiction.
1 connected LeverAsset-price inflation
A broad rise in prices of assets such as shares, bonds or property; unlike consumer inflation, it has no single universal official basket.
1 connected LeverAttribution
The explanation a person assigns to an observed change, which may differ from the mechanism that actually produced it.
1 connected LeverAttribution error
Assigning a bundled result to one visible component without isolating the alternatives.
1 connected LeverBalance-sheet effect
A price or exchange-rate change alters the value of assets and liabilities.
1 connected LeverBargaining power
The ability of workers or employers to influence pay and working conditions.
1 connected LeverBargaining range
The set of deals both sides prefer to the expected cost and risk of fighting.
1 connected LeverBaseline dependence
The effect of a change depends on what a person was eating and experiencing before it.
1 connected LeverBasis risk
The risk that the futures price and the local physical price do not move together exactly.
1 connected LeverBenchmark price
A reference price used across many physical and financial transactions.
1 connected LeverBrand portfolio
A set of distinct brands controlled by one company.
1 connected LeverBundled intervention
A change that alters several exposures together, so its result cannot by itself identify one cause.
1 connected LeverCable landing station
The coastal facility connecting a submarine cable to terrestrial networks.
1 connected LeverCapital buffer
Loss-absorbing equity that protects a bank's creditors and depositors.
1 connected LeverCapital control
A rule, tax or restriction that limits selected cross-border financial transactions.
1 connected LeverCapital inflow
Foreign acquisition of domestic assets or reduction in residents' foreign assets.
1 connected LeverCapital-flow reversal
A rapid shift from foreign money entering an economy to leaving it.
1 connected LeverCapitalisation
The process by which expected benefits or constraints become embedded in asset prices.
3 connected LeversChokepoint
A narrow route carrying flows that are difficult to reroute.
1 connected LeverCircumvention
Changing a transaction's route or form to avoid a restriction.
2 connected LeversClinical endpoint
An outcome that matters directly to health, such as a fracture or heart attack, rather than only a laboratory marker.
1 connected LeverCluster
A geographic concentration of linked skills, suppliers and infrastructure.
1 connected LeverCollective defence
An arrangement in which participants promise assistance when one of them is attacked.
1 connected LeverComparative advantage
The ability to produce something at a lower opportunity cost than an alternative producer.
1 connected LeverComplementary input
A separate item or service required for another product to work.
1 connected LeverConcentration risk
Exposure created when many activities depend on the same location or supplier.
1 connected LeverConfounding
When another difference between groups helps explain an apparent relationship between a food and an outcome.
1 connected LeverConsumer price inflation
The rate at which a basket of household consumption goods and services becomes more expensive.
1 connected LeverCost pass-through
The extent to which a firm's higher costs appear in the prices paid by customers.
1 connected LeverCounterparty risk
The risk that the other party to a financial contract fails to perform.
1 connected LeverCoupon
A bond's scheduled interest payment.
1 connected LeverCredible commitment
A promise or threat others have good reason to expect will be carried out.
1 connected LeverCritical mineral
A material economically important to a system and exposed to significant supply disruption risk.
1 connected LeverCurrency crisis
A sharp loss of confidence and value in a currency, often accompanied by reserve or financing pressure.
1 connected LeverCurrency mismatch
Liabilities are denominated in a different currency from income or assets.
1 connected LeverCurrency swap line
An agreement allowing two central banks to exchange currencies temporarily and reverse the exchange later.
1 connected LeverCurrent account
Trade in goods and services plus primary and secondary income flows with the rest of the world.
1 connected LeverCurrent earnings
Accounting profit reported for a recent period, which may contain temporary, non-cash or cyclical components.
1 connected LeverCustody
The holding and administration of securities or deposits for an owner.
1 connected LeverCustomer acquisition cost
The spending or discount used to win a new customer.
1 connected LeverCustomer churn
The rate at which customers end or fail to renew a relationship.
1 connected LeverDebt service
Interest and principal payments due on outstanding debt.
1 connected LeverDestination flexibility
The ability to redirect a cargo toward a different buyer or market.
1 connected LeverDeterrence
Changing another actor's choice by making aggression look too costly or unlikely to succeed.
1 connected LeverDiet identity
A food pattern that also supplies rules, belonging and a way to describe oneself.
1 connected LeverDiscount rate
The return used to convert an expected future payoff into a value today.
2 connected LeversDollar funding
Borrowing or obtaining dollars needed to finance assets, trade, or payments denominated in dollars.
1 connected LeverDollar funding market
The network through which institutions borrow and lend US dollars.
1 connected LeverDoom loop
A self-reinforcing cycle of weakening sovereign and bank balance sheets.
1 connected LeverDuration
A measure of how sensitive a bond's price is to interest-rate changes.
1 connected LeverEconomic incidence
The parties whose real income ultimately falls because of a tax.
1 connected LeverEconomic obsolescence
Replacement because continued use or repair no longer appears worthwhile.
2 connected LeversEconomies of scale
Lower average cost made possible by producing at a larger scale.
1 connected LeverEffective capacity
The amount a transport network can move within a given time, accounting for delays and distance.
1 connected LeverElasticity
How strongly quantity responds to a change in price.
1 connected LeverEnergy intensity
The amount of energy used to produce a unit of output.
1 connected LeverEnergy security
Reliable access to energy at manageable cost.
1 connected LeverEnvelopment
Using one platform position to enter or control adjacent services.
1 connected LeverEquity risk premium
The extra expected return investors require for holding risky shares rather than safer assets.
1 connected LeverEvolutionary mismatch
The hypothesis that some modern environments change faster than human biology can adapt to them.
1 connected LeverExit discipline
The pressure for persistently unprofitable capacity to close or restructure.
1 connected LeverExpected cash flow
Cash investors expect the business could distribute or reinvest profitably in the future.
2 connected LeversExperience good
A product whose quality is learned mainly through use.
1 connected LeverExport control
A legal restriction on transferring specified goods, software or know-how.
1 connected LeverExport jurisdiction
The legal basis for applying export rules to an item or transaction.
1 connected LeverFabrication plant
A highly specialized facility that manufactures semiconductor wafers.
1 connected LeverFeedstock
A raw material transformed into another industrial product.
1 connected LeverFertilizer affordability
The cost of fertilizer relative to the value farmers expect from crops.
1 connected LeverFinancial account
Cross-border transactions in financial assets and liabilities.
1 connected LeverFixed cost
A cost that does not rise proportionally with each sale.
1 connected LeverFixed-rate mortgage
A mortgage whose contracted interest rate stays fixed for a defined period or term.
1 connected LeverFood expenditure share
The portion of a household budget spent on food.
1 connected LeverFood matrix
The structure and combination of components in a food, which can affect its physiological effects.
1 connected LeverFood substitution
Replacing one food with another, changing what is added as well as what is removed.
1 connected LeverForeign Direct Product Rule
A US rule that can subject certain foreign-made items derived from specified US technology or software to export controls.
1 connected LeverForeign exchange intervention
A central bank purchase or sale of currencies to influence market conditions.
1 connected LeverFoundry
A company that manufactures chips designed by other firms.
1 connected LeverFructans
Fermentable carbohydrates found in some foods, including wheat; they are chemically different from gluten proteins.
1 connected LeverFutures contract
A standardised exchange-traded agreement tied to a later purchase or sale.
1 connected LeverGeneral-purpose technology
A technology used across many sectors and applications.
1 connected LeverGlobal financial cycle
International credit conditions that move together across markets.
2 connected LeversHedging
Taking a position designed to offset an existing price risk.
1 connected LeverHinterland
The inland region connected to a port through roads, rail, waterways and logistics networks.
1 connected LeverHub economy
Cumulative advantages created when flows and specialized services concentrate in one node.
1 connected LeverIndividual heterogeneity
People can respond differently to the same food because their physiology, context and goals differ.
1 connected LeverIndustrial overcapacity
Production capability that persistently exceeds demand at prices supporting normal commercial returns.
2 connected LeversIndustrial policy
Government action intended to shape the location or capabilities of production.
1 connected LeverInertia
Continuing with a default because active reconsideration requires attention.
1 connected LeverInflation expectations
Beliefs about future price growth that can influence decisions today.
1 connected LeverInformation lag
The delay before new information changes customer beliefs.
1 connected LeverInput pass-through
The transmission of a production-cost change into later prices or quantities.
1 connected LeverInput-output network
The web of industries buying inputs from and selling outputs to one another.
1 connected LeverInteroperability
The ability of different payment systems to exchange transactions reliably.
2 connected LeversIntervention bundle
A change that alters several foods, routines and behaviours at the same time.
1 connected LeverInventory buffer
Stock held to keep operating when deliveries are late or uncertain.
1 connected LeverInvoicing currency
The currency used to state the price and payment obligation in a trade contract.
1 connected LeverJurisdiction
The legal reach within which an authority can require or prohibit conduct.
1 connected LeverJurisdictional risk
Exposure to legal or political action in the place governing an asset or intermediary.
1 connected LeverLabour productivity
Output produced per worker or per hour worked.
1 connected LeverLactose tolerance
The amount of milk sugar someone can consume without troublesome symptoms; it depends on digestion, dose and individual response.
1 connected LeverLand-use regulation
Rules governing what and how much may be built on land.
1 connected LeverLeading edge
The most advanced commercially produced process technologies.
1 connected LeverLegal incidence
The party legally required to remit a tax.
1 connected LeverLifecycle cost
Purchase, operation, repair and replacement cost over a product's useful life.
2 connected LeversLiquefied natural gas
Natural gas cooled into liquid form for shipping and later regasified.
1 connected LeverLiquidity backstop
A facility that supplies funding when ordinary markets become impaired.
1 connected LeverLocal market
The geographic set of alternatives that customers realistically use.
1 connected LeverMacroprudential policy
Rules designed to limit risks across the financial system rather than one institution.
1 connected LeverMargin
The difference between revenue and relevant cost.
1 connected LeverMarginal product
The additional output associated with one more unit of labour under given conditions.
1 connected LeverMaritime service
Insurance, finance, brokering, flagging or technical support required for shipping.
1 connected LeverMarket concentration
The extent to which sales or control sit with a small number of firms.
1 connected LeverMarket tipping
A feedback process that moves much of a market toward one platform.
1 connected LeverMarket-distorting support
Government assistance that changes production or trade decisions relative to normal market conditions.
1 connected LeverMidstream bottleneck
A constrained processing stage between raw extraction and finished products.
1 connected LeverNarrative compression
Reducing many causes and choices into one memorable explanatory story.
1 connected LeverNegative option
An arrangement that continues unless the customer actively cancels.
1 connected LeverNet international investment position
A country's external assets minus its external liabilities.
3 connected LeversNetwork effect
A system becomes more useful to each participant as more other participants use it.
1 connected LeverNocebo effect
An adverse symptom response influenced by negative expectations; the symptoms remain real.
1 connected LeverOil benchmark
A reference price, such as Brent or WTI, used to price many physical oil transactions.
2 connected LeversOpportunity cost
The value of the best alternative forgone when a choice is made.
1 connected LeverOvercompliance
When firms avoid lawful activity because screening uncertainty or penalties make the perceived risk too high.
1 connected LeverPartitioned pricing
Presenting a total price as a base price plus one or more separate charges.
1 connected LeverParts pairing
Software linking a component to a specific device or authorization process.
2 connected LeversPass-through
The share of a cost change reflected in later prices.
1 connected LeverPath dependence
Past investment choices constrain the options available later.
1 connected LeverPayment rail
The infrastructure and rules used to transmit, clear or settle payment instructions.
1 connected LeverPayment sovereignty
The capacity to maintain essential payments under domestic public authority and policy choices.
1 connected LeverPersistence
The extent to which inflation continues after its initial trigger.
2 connected LeversPipeline lock-in
Dependence created by fixed transport infrastructure and connected demand.
1 connected LeverPolicy lag
The delay between a rate change and its broader economic effects.
2 connected LeversPolicy rate
The short-term interest rate directly influenced by a central bank.
1 connected LeverPolitical trigger
An event that activates existing pressures without being their sole root cause.
1 connected LeverPort connectivity
The frequency, capacity and range of shipping services linking a port to other markets.
1 connected LeverPortfolio rebalancing
Investors shifting into other assets when the return or availability of their existing holdings changes.
1 connected LeverPositive externality
A benefit to others that the decision-maker cannot fully capture in its own return.
1 connected LeverPresent value
Today's value of future payments discounted at a required return.
1 connected LeverPrice cap
A rule permitting specified services only when a covered commodity trades at or below a threshold.
1 connected LeverPrice discovery
Combining trades and information into a market price.
1 connected LeverPrice discrimination
Using product versions or conditions to charge different effective prices to customers with different needs or willingness to pay.
1 connected LeverPrice salience
The tendency for the most visible price to influence attention and comparison more than less visible components.
1 connected LeverPrice walking
Increasing a customer's price at successive renewals.
1 connected LeverPrice-to-income ratio
A comparison of home prices with household incomes.
1 connected LeverProduct differentiation
Designing offers to appeal to different preferences or uses.
1 connected LeverProtection and indemnity insurance
Liability coverage used by shipowners for major maritime risks.
1 connected LeverPurchasing power parity
A comparison that adjusts currencies for differences in local price levels.
1 connected LeverReal income
Income measured by the goods and services it can actually purchase.
1 connected LeverReal interest rate
An interest rate adjusted for expected inflation.
1 connected LeverRecurring revenue
Income expected to repeat while customers remain subscribed.
1 connected LeverRefinancing risk
The risk that maturing debt cannot be replaced at an affordable rate.
1 connected LeverRefining concentration
A large share of processing capacity located in a small number of countries or firms.
1 connected LeverRegasification
Converting imported LNG back into gas for pipelines and consumers.
1 connected LeverRepair capacity
Ships, permits, equipment and coordination needed to restore a damaged cable.
1 connected LeverReplication
Reusing a tested operating format in additional locations.
1 connected LeverReputation capital
Trust accumulated from past performance that influences present demand.
1 connected LeverReputation lag
The delay before changed performance alters market beliefs.
1 connected LeverReserve adequacy
Whether reserves are sufficient relative to plausible external payment and funding pressures.
1 connected LeverReserve asset
A liquid foreign asset controlled by monetary authorities and available for external financing needs.
1 connected LeverReserve currency
A currency and its assets held by central banks for intervention, liquidity, and precautionary needs.
1 connected LeverReserve diversification
Spreading reserve assets across currencies, instruments, custodians or jurisdictions.
1 connected LeverReserve immobilization
A restriction that prevents an authority from accessing or transferring reserve assets.
1 connected LeverRetention
The share of customers who continue the relationship.
1 connected LeverRight to repair
Policies seeking access to parts, tools, information and diagnostics needed for repair.
1 connected LeverRisk premium
Extra compensation demanded for bearing uncertain losses.
1 connected LeverRollover risk
The risk that maturing debt cannot be replaced with new borrowing.
1 connected LeverRoute diversity
Having physically independent paths so one disruption does not disable all connectivity.
2 connected LeversSafe asset
An asset expected to preserve value, remain liquid, and be accepted as collateral, especially during stress.
1 connected LeverSearch cost
The time and effort required to discover and compare the relevant price and product information.
1 connected LeverSecond-round effect
A later wage or price response that extends an initial shock beyond its direct impact.
1 connected LeverSecondary exposure
Risk faced by third-country firms when dealing with a target may threaten their access to the sender's market.
1 connected LeverSecurity dilemma
A situation where one actor's attempt to become safer makes another feel less safe.
1 connected LeverSelf-fulfilling expectation
A belief that changes behavior in ways that help produce the expected outcome.
1 connected LeverService life
The period a product is actually used before replacement or disposal.
1 connected LeverSettlement
The final transfer that discharges a payment obligation.
1 connected LeverShadow fleet
Ships and service arrangements used to reduce exposure to mainstream regulated maritime networks.
1 connected LeverShelf space
Limited retail display and inventory capacity over which suppliers compete.
1 connected LeverShort-term proxy
An early measure such as appetite, energy, weight or a blood marker that may not predict every long-term outcome.
1 connected LeverSocial safety net
Public programs that protect households from income and consumption shocks.
1 connected LeverSovereign bond
Debt issued by a national government.
1 connected LeverSovereign currency
A currency issued by the government or central bank whose debt is being discussed.
1 connected LeverSovereign-bank nexus
The financial feedback links between a government and its domestic banking system.
1 connected LeverSpare capacity
Production or transport capability available beyond current use.
1 connected LeverSubmarine cable
A fiber-optic cable laid on the seabed to carry communications between land networks.
1 connected LeverSubsidy race
Competition in which governments offer support to attract the same mobile investment.
1 connected LeverSubstitutability
How easily another material or technology can perform the same function.
1 connected LeverSubstitution effect
The difference a food change makes relative to the particular food or nutrient it replaces.
1 connected LeverSudden stop
An abrupt reduction or reversal of foreign capital inflows.
1 connected LeverSunk cost
An investment that cannot be fully recovered after it is made.
1 connected LeverSupplier qualification
Testing and approving a supplier to meet technical, quality and reliability requirements.
1 connected LeverSupply elasticity
How strongly new housing supply responds to higher prices.
1 connected LeverSupply shock
An abrupt change in the cost or availability of important inputs.
1 connected LeverSupply-chain ecosystem
The connected suppliers, services, skills and infrastructure needed to deliver a product.
1 connected LeverSurvivorship bias
Judging a population from the members that remained observable.
3 connected LeversSwitching cost
The time, risk or money involved in changing supplier.
1 connected LeverTechnical failure
Loss of function caused by a component or system fault.
1 connected LeverTechnological chokepoint
A hard-to-substitute capability controlled by few suppliers.
1 connected LeverTrade remedy
A tariff or measure responding to dumping, subsidies or import surges under defined rules.
1 connected LeverTransmission
The channels through which a policy decision affects financing, demand and prices.
1 connected LeverTransshipment
Moving cargo between vessels at an intermediate port.
1 connected LeverUnbundling
Selling components separately that were previously offered together as one product.
1 connected LeverUpstream dependency
Reliance on tools, software or knowledge needed before final production.
1 connected LeverValuation multiple
A ratio such as price-to-earnings that shows how much investors pay per unit of a current or expected financial measure.
1 connected LeverVariable-rate mortgage
A mortgage whose rate can reset with a reference rate or lender schedule.
1 connected LeverVehicle currency
A currency used between parties even when neither party uses it at home.
1 connected LeverYield
Return implied by a bond's price and promised cash flows.
1 connected LeverYield curve
The set of market interest rates for borrowing over different maturities.