Why were there three world recessions between the 1970s and the 1990s?

Why were there three world turning points amidst the 1970s and the nineties?A recession is one or more than accompanying years of negative real GDP ingathering. The opposite of recession is expansion where there a year or more of positive growth is experienced.

The world economy has experienced prodigious slowdown in the early 1990s. Business cycles ar forever and a day present in market-oriented economies. Arthur Burns (1947) wrote: For well over a century, business cycles have run an unceasing round. They have persisted by vast economic and social changes; they have withstood countless experiments in industry, agriculture, banking, industrial relations, and public policy; they have confounded forecasters without number, belied repeat prophecies of a new era of prosperity and outlived repeated forebodings of chronic depression. The same observations could be make today? (World scotch Outlook, 2002 page 1).

Business cycles be main(prenominal) in determining the take aims of recession in a land?s economy. It is defined as recurring chain of growth and recessions in the level of economic activity. It also means alternating(prenominal) rise and fall in economic activity approximately a trend particularly its growth cycle, where the growth evaluate are high and level recessions are rare (World stinting Outlook, 2002 page 1).

Business cycles in industrial countries after 1973 are characterized by lower growth rates and common level recessions.



Growth cycles depend on subjective distinction between trend and cycle, and key cyclical characteristics depend largely on which trending method is used. Level cycles can also be persistent using rig per capita, which is a better measure of upbeat and clearly recognizes that high growth rates of output are sometimes caused by rapid population growth. In practice, output per capita recessions in industrial countries after 1973 were similar to output recessions, as population growth rates were generally low (World Economic Outlook, 2002 page 1).

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