All other things being equal

The ceteris paribus clause (in German “others remain the same”) plays an important role, especially in economic theory. Since economic relationships mostly influence one another, it is difficult to carry out a theoretical analysis in which the causes and effects are difficult to determine.

In order to analytically simplify this complex relationship, one assumes that certain quantities do not change. This assumption is known as the ceteris paribus clause. An unproblematic example of this is an economic model that assumes that the population will remain the same over the next two years. If, on the other hand, this were assumed for the next 10 years, the ceteris paribus clause would be far more problematic because it would be unrealistic: It ignores significant changes in population development and thus incorrectly assesses their repercussions on the economy.

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