multiplier effect

1. An effect in economics in which an increase in spending produces an increase in national income and consumption greater than the initial amount spent. For example, if a corporation builds a factory, it will employ construction workers and their suppliers as well as those who work in the factory. Indirectly, the new factory will stimulate employment in laundries, restaurants, and service industries in the factory's vicinity.

Example Sentences

"The fiber-optic cable allowed us to measure this incredible calving multiplier effect, which wasn't possible before," says Gräff.

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“It’s almost like a multiplier effect,” says Brian Schultz, a tax partner at Plante Moran in Southfield, Mich.

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But what about a multiplier effect?

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Manufacturing remains the key to productivity growth, packs a far higher multiplier effect on local economies than retail, trade or finance and generally pays far higher wages.

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According to Swiss investment bank UBS, the GST cuts will also have a larger "multiplier effect" than the previous corporate and income tax cuts undertaken by Modi, as they "directly affect consumption at the point of purchase, potentially leading to higher consumer spending".

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