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Definition of Ceteris Paribus. Ceteris Paribus is a Latin phrase meaning âall other things remaining equalâ. The concept of ceteris paribus is important in economics because in the real world it is usually hard to isolate all the different variables.
This feature is not available right now. Please try again later. This is a lesson that focuses on a common principle in economics and that is ceteris paribus. Basically, Ceteris Paribus (Latin) is a phrase that means, we will keep everything else the same except the variable we are concerned with. To illustrate the example of ceteris paribus in action I use the example of the price of ice cream in relation to the quantity of ice cream sold. In this example we would want to hold all other variables equal, especially the ones that could potentially affect our data.