Long Run Supply Curves

[tessosteroni]

While spacing out on my Economics notes, a curious question came to me:

If the Long Run time period is a time for which all factors of production can be varied, does this mean all Supply curves are theoretically elastic in this time frame regardless of their short term elasticity?

Help is much appreciated.

Thanks.

[Keel]

While spacing out on my Economics notes, a curious question came to me:

If the Long Run time period is a time for which all factors of production can be varied, does this mean all Supply curves are theoretically elastic in this time frame regardless of their short term elasticity?

Help is much appreciated.

Thanks.

Yes it does. As the short run turns into the long run the supply of goods generally turn elastic. This sort of contradicts the notion of there being a finite number of resources to be utilised but if time is infinite, the model assumes infinite supply. It's the same problem with trade diagrams where the global supply of a good is assumed to be purely elastic due to the mass quantity of producers. In reality, we know that such scenarios are simply not possible.