In economics, “ad hoc” refers to actions, decisions, or policies that are made or taken for specific, often immediate purposes, without being part of a wider plan or system. Ad hoc measures are usually designed to address particular issues or situations as they arise, rather than following a pre-established plan or methodology.
Think of “ad hoc” as an approach where you make decisions or solve problems as they come up, rather than sticking to a fixed plan. It’s like deciding to bring an umbrella with you because it looks like it might rain today, even though you don’t usually carry one. In economics, this could mean creating a one-time policy to deal with an unexpected financial crisis.
Ad hoc measures are commonly found in economic policy-making, financial management, and business strategy. Governments might introduce ad hoc fiscal policies to stimulate an economy during a downturn, businesses may implement ad hoc strategies to deal with sudden market changes, and financial analysts might use ad hoc analyses to address unique investment opportunities or risks.
For Example, a government introducing a one-time tax rebate to boost consumer spending during a recession is an ad-hoc measure. Similarly, a company launching an ad hoc promotional campaign in response to an unexpected drop in sales.
Source: A to Z of Economics by Dr. NC Raghavi Chakravarthy