Recessions and recoveries
The U.S. recession that began in July 1990 may have ended in April or May 1991. The pace of the subsequent recovery has been so sluggish as to be indistinguishable, in the eyes of many, from continued recession. One explanation for the sluggish pace of the recovery is that the recession itself was not particularly severe, at least when compared with others. ; In this article, Mark Wynne and Nathan Balke use monthly data on industrial production to examine the hypothesis that the severity of a recession determines the pace of the subsequent recovery. They show that, historically, the relationship between growth in the first twelve months of a recovery and the decline in industrial activity from peak to trough is statistically significant. However, there is no relationship between the length of a recession and the strength of the recovery. Consistent with their finding of a bounce-back effect for industrial production, the recovery from the 1990-91 recession is the weakest in the period covered by the Federal Reserve Board's industrial production index, just as the decline in industrial production over the course of that recession is the mildest on record.
Volume (Year): (1993)
Issue (Month): Jan ()
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- Wynne, Mark A. & Balke, Nathan S., 1992.
"Are deep recessions followed by strong recoveries?,"
9201, Federal Reserve Bank of Dallas.
- Wynne, Mark A. & Balke, Nathan S., 1992. "Are deep recessions followed by strong recoveries?," Economics Letters, Elsevier, vol. 39(2), pages 183-189, June.
- Christina D. Romer, 1992.
"Remeasuring Business Cycles,"
NBER Working Papers
4150, National Bureau of Economic Research, Inc.
- Daniel E. Sichel, 1992. "Inventories and the three phases of the business cycle," Working Paper Series / Economic Activity Section 128, Board of Governors of the Federal Reserve System (U.S.).
- Gerhard Bry & Charlotte Boschan, 1971. "Cyclical Analysis of Time Series: Selected Procedures and Computer Programs," NBER Books, National Bureau of Economic Research, Inc, number bry_71-1, September.
- Arthur F. Burns & Wesley C. Mitchell, 1946. "Measuring Business Cycles," NBER Books, National Bureau of Economic Research, Inc, number burn46-1, September.
- Christina D. Romer, 1991.
"What Ended the Great Depression?,"
NBER Working Papers
3829, National Bureau of Economic Research, Inc.
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