Hayekian Triangle

The Hayekian Triangle is a visual tool used in economics to show the structure of production over time. It depicts how resources are allocated from initial stages (like raw materials) to later stages (like finished products). The triangle's width at each level reflects the value added at that stage, illustrating how earlier investments support later production. It emphasizes the process of economic development and how decisions made in earlier phases impact overall supply. This helps explain concepts like capital structure and production flow, highlighting the importance of proper investment timing for balanced economic growth.