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In the political economy world, recession is defined as the general downturn that occurs in whatsoever kind of economy.
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What is the difference between a recession and depression?
A recession means a change of the economy development trend in the long-term. Recessions are normally fairly short-lived. A longer recession, always over twelve month period or longer, it is defined as depression.
What is a devastating recession called?
Devastating recession is called economic collapse. Economic recessions relates with excess merchandise inventory, the fall in consumption (possibly due to loss of confidence in the future), technology innovation, the lack of new capital accumulation, and the randomness of stock market.
What do economists rely on to formalize a recession?
But economists do not rely solely on GDP to formal a conclusion if the economy is into a recession. Some economists and newspaper writer define a recession as the gross domestic product, income, and unemployment continue to reduce for six months.
What is the main reason for the recession?
Keynes argued that the reduction in aggregate demand for goods is the main reason for the recession (Ireland, Peter N,2011). Economic recession could lead to declines of a number of economic indicators at the same time, such as employment, investment and corporate profits, and other associated phenomena including changes in price levels.
Last Update: Oct 2021
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