The time it takes a change in economic policy to induce people and firms to change their behavior is the implementation lag.

Question

Quizplus · Accepted Answer

The implementation lag refers to the time it takes to implement a policy after it has been decided upon, not the time it takes for people and firms to change their behavior in response to the policy. The time it takes for people and firms to change their behavior is more accurately described as the effect lag or impact lag.

The Time It Takes a Change in Economic Policy to Induce