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Business Cycle Fluctuations: why are so undesirable?

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  • khan, sajawal

Abstract

The main focus of macroeconomic policies around the world is the stabilization of business cycles fluctuations. The policy makers, economists, producers and households are all concerned about the swings in economic activities and want to mute them down. The question arises why these fluctuations are so undesirable and everyone is too much worried about them. The main reason behind these concerns is. 1) Business cycle fluctuations lowers the lifetime discounted income/ consumption in the economy. 2) These fluctuations also affect distribution of income in the society. 3) These negatively affect the long run potential level of the economy. The focus of this study is to investigate; whether the business fluctuations affect long run potential level; and the role and importance of asymmetries in the behavior and impacts of these fluctuations.

Suggested Citation

  • khan, sajawal, 2018. "Business Cycle Fluctuations: why are so undesirable?," MPRA Paper 93172, University Library of Munich, Germany, revised 12 Jan 2019.
    • Handle: RePEc:pra:mprapa:93172
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    File URL: https://mpra.ub.uni-muenchen.de/93172/1/MPRA_paper_93172.pdf
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    References listed on IDEAS

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    Cited by:

    1. Summaira Malik & Ali Abbas & Malik Shahzad Shabbir & Carlos Samuel Ramos-Meza, 2024. "Business Cycle Fluctuations, Foreign Direct Investment, and Real Effective Exchange Rate Nexus Among Asian Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 5466-5479, June.

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    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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