Explain the factors that cause shift in supply curve.

A shift in the supply curve occurs when a non-price factor changes, moving the whole curve — a rightward shift means an increase in supply and a leftward shift means a decrease; the main factors causing such shifts are as follows.

1. Price of factors of production: a rise in input costs such as raw materials, wages and energy shifts supply leftward, while a fall in input costs shifts it rightward.
2. Cost of production: since input prices feed into cost, any general rise in the cost of production reduces supply and any fall raises it.
3. Number of firms in the industry: the entry of more firms shifts supply rightward, while the exit of firms shifts it leftward.
4. Fiscal policy of the government: higher taxes raise cost and shift supply leftward, while lower taxes or subsidies shift it rightward.
5. Government subsidy: a subsidy lowers the producer's cost and shifts the supply curve rightward, increasing supply.
6. Change in technology: modern, improved technology raises output from the same inputs and shifts supply rightward, while outdated technology shifts it leftward.
7. Change in population: a larger population raises demand, prompting producers to supply more and shifting the curve rightward.
8. Price expectation: if sellers expect prices to rise in future they hold back stock now (supply shifts left), while expecting a fall makes them sell more now (supply shifts right).
9. Price of related/substitute goods in production: a fall in the price of a substitute good encourages firms to supply more of this good (rightward), and a rise does the reverse.
10. Natural factors: favourable weather, good monsoon or absence of disasters raises supply (rightward), while floods, drought or strikes reduce it.

Thus, any change in cost, technology, taxes, subsidies, the number of firms or expectations shifts the entire supply curve, unlike a mere own-price change which only moves along it.