The financial encyclopedia uses cookies to improve your user experience. Find out more here!




Endogenous variable


A variable whose value is to be determined byforces operating within the model under consideration. For example, in a mode! of the market for wheat the price of wheat is an endo­genous variable because it is deterrnined by the forces of supply and demand, which are incorporated in the mode!.

Reference: The Penguin Dictionary of Economics, 3rd edt.