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On some issues concerning definition of an economic recession

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  • Jiří, Mazurek

Abstract

In the article it is shown that current definitions of economic recessions are unsatisfactory. NBER definition of an economic recession is only qualitative, so it does not enable identifying recession unequivocally. Another often used ‘technical definition’ of a recession takes into account only quarter-to-quarter changes in real GDP without considering changes in population, so in some cases economy can be in recession while real GDP per capita is actually increasing, and vice versa. Hence, the aim of the article is to propose new quantitative definition of an economic recession based both on economic and population growth or decline respectively. The use of the proposed definition is illustrated on examples of recent economic development in selected countries of the European Union.

Suggested Citation

  • Jiří, Mazurek, 2012. "On some issues concerning definition of an economic recession," MPRA Paper 43381, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:43381
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    File URL: https://mpra.ub.uni-muenchen.de/43381/1/MPRA_paper_43381.pdf
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    References listed on IDEAS

    as
    1. Sergio Rebelo, 2005. "Real Business Cycle Models: Past, Present and Future," Scandinavian Journal of Economics, Wiley Blackwell, vol. 107(2), pages 217-238, June.
    2. Jiří Mazurek & Elena Mielcová, 2013. "The Evaluation of Economic Recession Magnitude: Introduction and Application," Prague Economic Papers, Prague University of Economics and Business, vol. 2013(2), pages 182-205.
    3. Rendigs Fels, 1952. "The Theory of Business Cycles," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 66(1), pages 25-42.
    4. Sergio Rebelo, 2005. "Real Business Cycle Models: Past, Present and Future," RCER Working Papers 522, University of Rochester - Center for Economic Research (RCER).
    5. Charles S. Gascon, 2009. "The current recession: how bad is it?," Economic Synopses, Federal Reserve Bank of St. Louis.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    definition of a recession; European Union; population growth; recession;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology

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