As lower costs encourage firms to produce more at any given price (ie, the supply curve shifts from S1 to S2 in the chart), the long-term equilibrium level of output will rise and the price level will fall.

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It is found in the aggregate supply curve.

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Oxidation catalysts and other emissions controls can be installed to reduce the polluting effect of diesel generation and it must also be considered that peak-shaving DR resources will displace peaking units which are the most pollution-heavy resources on the supply-dispatch curve that are also closest to load centers.

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I'm not saying just all the time the Laffer curve works or all the time supply-side economics works.

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As an example, a lot of the economics blogs that I read tend to have posts that already assume you understand the basic supply and demand curve graphs.

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In his book, Mr Sen raised the theoretical possibility that a pastoralist's supply curve might actually bend back on itself: as the relative price of livestock falls, a hungry pastoralist might supply more animals to the market, not fewer as elementary economic principles would imply.

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Looking to build stockpiles with prices low, the Chinese government has begun to accelerate its purchases in order to supply its growing needs ahead of the curve.

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Manufacturers and retailers now deploying smart supply chains will jump the learning curve and become the Wal-Marts and Dells of the 21st century.

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There is one theoretical way out of this dilemma: Supply-side economics, featuring the Laffer Curve, which under some circumstances enables us to have our cake and eat it too.

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