Non-Price Determinants of Supply

Input Costs, including Technology (factors of production, including raw materials, electricity, wages; lower costs generally go hand-in-hand with higher profits, causing producers to supply more product at each pricemoves curve to right) Government Influence o Subsidiespayments to private business by govt. Subsidies and taxes have opposite effects on supply, since subsidies can reduce a businesss production costsshift curve to right. o Taxespayments to govt to help fund govt services. Since taxes add to companys production costs, lower taxes reduce costs and higher taxes increase costs of doing business. o Regulationsrules about how companies conduct business. Strict regulations increase production costs shift curve to left. Future Expectations: Producers make decisions based on expected future income. If demand is expected to increase, supply might shift to right, and vice versa. Number of Suppliers: tends to increase supply and lower pricesshift curve to right.