Equation 9 · Part 1 · Selection Accounting: The Price Equation Runs the Economy
Symbol β
What this part means
never a constant of nature.
Its job in the formula
β is a part of this expression. Its role is fixed by the surrounding article and by the operations shown in the formula.
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Where the article explains it
What the paper adds is a discipline on : because realized market selection acts on profitability rather than on physical output alone, per Foster, Haltiwanger, and Syverson’s finding that price and physical productivity pull in opposite directions across surviving plants [ 14 ] , is never a constant of nature.
The passage around this formula
The selection component of the growth rate of mean log productivity equals a selection-intensity coefficient times the share-weighted variance of log productivity across firms. The qualitative move is not new: Metcalfe applied Fisher’s principle to competing firms under replicator dynamics in the 1990s [ 4 ] , and Andersen used Price’s equation itself, by name, to split economic change into…
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Sources cited in the surrounding passage
- [4] Competition, Fisher's Principle and Increasing Returns in the Selection Process ↗
- [5] Population Thinking, Price's Equation and the Analysis of Economic Evolution ↗
- [14] Reallocation, Firm Turnover, and Efficiency: Selection on Productivity or Profitability? ↗
- [10] Misallocation and Manufacturing TFP in China and India ↗
- [9] What Determines Productivity? ↗
These citations provide research context; check each source for the exact claim it supports.