Clarifying (Opportunity) Costs

The American Economist, Forthcoming

9 Pages Posted: 8 Sep 2013 Last revised: 8 Nov 2014

See all articles by Daniel F. Stone

Daniel F. Stone

Bowdoin College - Department of Economics

Date Written: November 2014

Abstract

Opportunity cost is considered to be a fundamental concept in economics. But the definition of the term continues to be controversial. I describe how the term is widely used in two distinct ways, both in the academic and non-academic literatures. I propose a practical way for educators to clarify the concept and related terminology.

Keywords: Opportunity cost, implicit cost, explicit cost, economic cost

JEL Classification: A22, A21

Suggested Citation

Stone, Daniel F., Clarifying (Opportunity) Costs (November 2014). The American Economist, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2321382 or http://dx.doi.org/10.2139/ssrn.2321382

Daniel F. Stone (Contact Author)

Bowdoin College - Department of Economics ( email )

Brunswick, ME 04011
United States
6463387833 (Phone)

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