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» Personal Loan No Credit Check, Online Economics » Management economics » Topics begins with E » Economic principle

Page modified: Tuesday, July 12, 2011 21:10:40

The economic principle (also as input output relation or efficiency postulate admits) describes the co-ordination mechanism, after which in the political economy one tries to satisfy as much as possible the unlimited needs despite the limited means (knappe of goods). There is the economic principle in two developments:

  • Minimum principle, minimum principle or SparprinzipDas a goal which can be achieved are given. The employment of funds should be as small as possible - minimum - with a certain yield. Example: Drive a given number with as little a gasoline as possible from kilometers. Enterprises work with this principle.
  • Maximum principle, maximum principle or HaushaltsprinzipDer employment of funds are given. As ambitious - maximum - a goal as possible is to be achieved. Example: With a given gasoline quantity as much as possible kilometers drive. Municipalities (public households) work with this principle. ''

The economic principle is a purely formal principle, which only the way ("how ") of managing describes. The principle does not make statements about goals or motives of managing (maximization of profit, increase in sales, enlargement of the market shares).

It is a widespread mistake that it is particularly meaningful to try to obtain a maximum result with minimum employment of funds (minimum minimum) (maximum principle). This so-called min max principle (also optimal principle) leads however to unplanned acting, since according to the minimum principle no clear defaults are not made and according to the maximum principle a clear goal are pursued - in addition would be called that of wanting to reach in extreme cases everything with nothing. The optimization, e.g. with the Kaizen, can take place therefore only gradually and after each optimization step must be examined whether with the maximum principle all necessary parameters of the target (quality) are present, and/or whether with the minimum principle all necessary conditions are fulfilled, in order the goal lastingly to reach (e.g. laws and editions e.g. to the industrial safety).

Thus a renouncement of industrial safety measures would lower the costs (minimum principle), in addition, the risk would increase. On a long-term basis would have to be counted on negative consequences, up to the prohibition of the enterprise and to criminal consequences.

To the thriftiness principle in the science see Ockhams razor.

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