two effects that occur jointly when the price of an item changes; an output effect is the change in a firm's profitability resulting from a price change for a particular input or component; a substitution effect is the change in input mix adopted in response to an output effect to regain or increase profitability —note substitution effects result in a shift along the same isoquant whereas output effects cause the firm to move to a different isoquant —see income and substitution effects, isoquant map This definition last updated 07/22/2008