The short run is a concept that states that, within a certain period in the future, at least one input is fixed while others are variable. In economics, it expresses the idea that an economy behaves differently depending on the length of time it has to react to certain stimuli.
The short run as a constraint differs from the long run. In the short run, leases, contracts, and wage agreements limit a firm's ability to adjust production or wages to maintain a rate of profit. In the long run, there are no fixed costs; costs find balance when the combination of outputs that a firm puts forth results in the sought after amount of the goods at the cheapest possible price.
If a hospital experiences lower than expected demand in a given year, but its entire employment force of doctors, nurses, and technicians is under contract for the year, then the hospital has no choice but to swallow a cut in its profit.In the long run, firms in capital-intensive industries, such as oil and mining, have time to expand or shrink operations in factories or investments in correspondence with changing demand. But in the short run, they are unable to capitalize on changes in demand with the same degree of flexibility.