Economics: Principles & Practices
Definition: People with all their abilities and efforts; one of four factors of production, does not include the entrepreneur
Labor force (Current Population Survey)
Labor force participation rate
Labor mobility
Labor productivity
Bureau of Labor Statistics (BLS)
Definition: Labor productivity refers to the relationship between output and the labor time used in generating that output. It is the ratio of output per hour.
Labor union
Laffer curve
Economics: Principles & Practices
Definition: Graph showing that lower tax rates will supposedly stimulate higher tax revenues
Federal Reserve Bank of Cleveland
Definition: A curve which illustrates the idea that there is an optimal tax rate. As the tax rate rises, so do tax revenues. But there is a point after which the tax rate becomes so high that it discourages the economic activity that creates the tax base that generates the tax revenue. After this point, tax revenues steadily decrease as the tax rate rises higher, until they again reach 0.
Bureau of Labor Statistics (BLS)
Definition: Sum(p2q1)/Sum(p1q1)–A weighted aggregative index showing the ratio of expenditures in the current period (p2q1: where p2 is the current period price and q1 is the base period quantity) to the expenditure in the base period (p1q1: where p1 is the current period price and q1 is the base period quantity) to purchase the identical market basket of items. It answers the question ”How much more or less does it cost now to purchase the same items as in the base period?”. The main shortcoming of the Laspeyres index is in that it does not track actual expenditures because consumers adjust their buying in response to changes in relative price, changing the composition of the market basket. This invalid assumption that consumer demand is totally price inelastic causes the index to overstate the actual effect on consumers when there is a change in prices.
Federal Reserve Bank of Cleveland
Definition: Legal tender laws require that residents of a country accept payment in that country’s currency even if the contract stipulates payment be made in another country’s currency, gold, bales of hay, or whatever. See also specific performance legislation.
Related Term(s): Specific performance legislation
Federal Reserve Bank of Cleveland
Definition: An institution which can extend credit to depository institutions or to other entities in unusual circumstances involving a national or regional emergency, where failure to obtain credit would have a severe adverse impact on the economy.
Federal Reserve Bank of Minneapolis
Definition: As the nation’s central bank, the Federal Reserve has the authority and financial resources to act as “lender of last resort” by extending credit to depository institutions or to other entities in unusual circumstances involving a national or regional emergency, where failure to obtain credit would have a severe adverse impact on the economy.
Federal Reserve Bank of San Francisco
Definition: As the nation’s central bank, the Federal Reserve has the authority and financial resources to act as ‘lender of last resort’ by extending credit to depository institutions or to other entities in unusual circumstances involving a national or regional emergency, where failure to obtain credit would have a severe adverse impact on the economy.
Life expectancy
Life insurance
Limited life
Limited partnership
Linear regression
Federal Reserve Bank of Cleveland
Definition: A statistical procedure which fits a straight line to set of data points. The line is fitted so that as many of the points fall on or near the line as possible. For the case of two variables, the data points represent observed values of the X variable at a corresponding value of Y (for example, the age and weight measurements of 100 randomly selected people). If X and Y are correlated, then the equation that defines the line amounts to a prediction of what Y will be for any value of X (the equation is used to generate a Y value for a given X value). How good the prediction is depends on how closely the line fits the data points (if all the points fit on the line, the line explains the relationship between X and Y perfectly. If age and weight were perfectly (and linearly) correlated, you could plug in a person’s age into the regression equation and accurately predict his or her weight.)
Liquidating account
Definition: A budgetary account associated with certain credit programs that includes all cash flows resulting from all direct loan obligations and loan guarantee commitments made under those programs before October 1, 1991. See also credit reform; compare with financing account.
Related Term(s): Credit reform, Financing account
Liquidity
Economics: Principles & Practices
Definition: Potential for being readily convertible into cash or other financial assets
Definition: The ease with which an asset can be sold for cash. An asset is highly liquid if it comes in standard units that are traded daily in large amounts by many buyers and sellers. Among the most liquid of assets are U.S. Treasury securities.
Bureau of Economic Analysis (BEA)
Definition: Income that is received by, or on behalf of, all persons who live in the local area. It is calculated as the sum of wage and salary disbursements, supplements to wages and salaries, proprietors’ income with inventory valuation adjustment (IVA) and capital consumption adjustment (CCAdj), rental income of persons with CCAdj, personal dividend income, personal interest income, and personal current transfer receipts, less contributions for government social insurance. Estimates of local area personal income are presented by the place of residence of the income recipients. All estimates of local area personal income are in current dollars (not adjusted for inflation).
Related Term(s): Personal income, State personal income
Definition: Any of several legislative mechanisms that attempt to isolate or ”lock away” funds of the federal government for purposes such as reducing federal spending, preserving surpluses, or protecting the solvency of trust funds. See also surplus and trust funds.
Related Term(s): Surplus, Trust funds
Long term disability insurance
Longitudinal data (panel data)
Bureau of Labor Statistics (BLS)
Definition: Data in which many units are observed over multiple time periods. The Bureau of Labor Statistics’ National Longitudinal Surveys (NLS) program collects data from a particular age group of people over many years on an annual or biennial basis. The panel data track the same sample of individuals over many time periods.
Long-term interest rate
Long-term interest rates
Federal Reserve Bank of San Francisco
Definition: Interest rates on loan contracts–or debt instruments such as Treasury bonds or utility, industrial, or municipal bonds–having maturities greater than one year. Often called capital market rates.
Related Term(s): Capital market rates
Lorenz curve
Lost workday cases (Safety and Health)
Lost workday cases involving days away from work (Safety and Health)
Bureau of Labor Statistics (BLS)
Definition: Hours absent as a percent of hours usually worked. Absences are defined as instances when persons who usually work 35 or more hours per week worked less than 35 hours during the reference week for one of the following reasons: own illness, injury, or medical problems; child-care problems; other family or personal obligations; civic or military duty; and maternity or paternity leave.
Bureau of Labor Statistics (BLS)
Definition: These are made to employees in lieu of a general wage rate increases. The payment may be a fixed amount as set forth in a labor agreement or an amount determined by a formula. For example, 2.5 percent of an employee’s earnings (wages, cost-of-living allowance payments, shift differential payments) during the prior year. Lump-sum payments are not incorporated into an employee’s base pay rate or salary.