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In economics, the life-cycle hypothesis (LCH) is a model that strives to explain the consumption patterns of individuals. Theory and evidence ...
The Product Life Cycle Theory is an economic theory that was developed by Raymond Vernon in response to the failure of the Heckscher–Ohlin model to explain the observed pattern of international trade. The theory suggests that early in a product's life-cycle all the parts and labor associated with that product come from the area where it was ...
Life-cycle cost analysis (LCCA) is an economic analysis tool to determine the most cost-effective option to purchase, run, sustain or dispose of an object or process. The method is popular in helping managers determine economic sustainability by figuring out the life cycle of a product or process.
Economic theories of intertemporal consumption seek to explain people's preferences in relation to consumption and saving over the course of their lives. The earliest work on the subject was by Irving Fisher and Roy Harrod, who described 'hump saving', hypothesizing that savings would be highest in the middle years of a person's life as they saved for retirement.
This theory explains the nature and causes of economic cycles from the viewpoint of life-cycle of marketable goods. [55] The theory originates from the work of Raymond Vernon, who described the development of international trade in terms of product life-cycle – a period of time during which the product circulates in the market. Vernon stated ...
Another model to look at for consumption smoothing is Hall's model, which is inspired by Milton Friedman. Since Friedman's 1956 permanent income theory and Modigliani and Brumberg's 1954 life-cycle model, the idea that agents prefer a stable path of consumption has been widely accepted.
The OLG model is the natural framework for the study of: (a) the life-cycle behavior (investment in human capital, work and saving for retirement), (b) the implications of the allocation of resources across the generations, such as Social Security, on the income per capita in the long-run, [1] (c) the determinants of economic growth in the ...
Each industry has several life-cycle models to consider, but most are relatively similar. Below is one possible life-cycle model; while it emphasizes hardware-oriented products, similar phases would describe any form of product or service, including non-technical or software-based products: [16]