Principle to Practice

Using Market Effects

Market Effects are the result of changes in the local incentive structures and patterns of opportunity caused by the introduction of new resources. The new resources noticeably affect incomes, wages, profits, and prices so that people’s perception of economic winners and losers changes.

Using Market Effects

You need to know what your resources are and how they overlap with local resources. You should be aware of local power dynamics and how they link to economic interests. Review your criteria for hiring staff and working with partners.

Your Critical Detail Mapping will have helped you identify the resources that you are introducing into a context. Review these especially in light of all the economic Dividers and Connectors you have identified.

Interventions often intend to improve wages and incomes. The patterns of Market Effects can increase welfare and, by doing so, decrease tensions. When interveners prompt broadly inclusive Market Effects that spill across groups and engage people in economically interdependent activities, this can reinforce Connectors. Can incentives be found that encourage wider economic opportunities?

Previous Page Why do negative Market Effects happen?
Next Page Substitution Effects

Related Topics
Critical Detail: Resources—What do we provide?
Market Effects
Market Effects on Incomes
Market Effects on Wages
Market Effects on Profits
Market Effects on Prices
Resource Transfers

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