Depression or Recession? Determining Whether the U.S Essay

Pages: 2 (568 words)  ·  Bibliography Sources: 3  ·  File: .docx  ·  Level: College Senior  ·  Topic: Economics

Depression or Recession?

Determining whether the U.S. economic crises of 2008 is a "depression" or a "recession" depends largely on whether one applies traditional one-dimensional criteria (such as the absolute measure of decline in GDP) or multi-dimensional criteria (such as: 1. The complex interrelationship between consumption and leisure and 2. The underlying financial mechanisms that trigger the event). Generally, to the extent one relies on traditional one-dimensional criteria, the economic crisis of 2008 was a recession; to the extent one relies on more complex criteria, it more closely resembles a depression, particularly in the manner that it occurred.

One of the most important traditional "textbook" criteria for identifying an economic depression is change in GDP. By that one-dimensional criterion, any economic downturn that results in a reduction in the national GDP of 10% or more is a "depression" whereas a lesser reduction in GDP is a "recession." Another traditional one-dimensional criterion of economic depressions is a high rate of unemployment. By that measure, the Great Depression was a bona fide depression because unemployment reached nearly 25% of the U.S. workforce. Meanwhile, the 10% unemployment rate of the 2008 economic crisis suggests that it was merely an economic recession (Judis, 2010).Buy full Download Microsoft Word File paper
for $19.77

Essay on Depression or Recession? Determining Whether the U.S. Assignment

However, by a more complex analysis of other factors, the economic crisis of 2008 was more similar to a depression, primarily by virtue of the underlying precipitating factors that caused it (Judis, 2010; Ohanian, 2010). First, economic recessions reflect ordinary (downward) fluctuations in business cycles. Conversely, economic depressions are precipitated by specific financial crises such as worldwide gold outflow-related global inflation in 1893, the stock market crash of 1929, and the sub-prime mortgage crisis of 2007 and 2008. Second, economic depressions are precipitated by… [END OF PREVIEW] . . . READ MORE

Two Ordering Options:

?
Which Option Should I Choose?
1.  Buy full paper (2 pages)Download Microsoft Word File

Download the perfectly formatted MS Word file!

- or -

2.  Write a NEW paper for me!✍🏻

We'll follow your exact instructions!
Chat with the writer 24/7.

What Is the Difference Between a Depression and a Recession? Essay


Current Recession Thesis


US Tax Policy Research Proposal


Browne and S. Keeley Research Paper


Recession in America Effects on the American People Thesis


View 200+ other related papers  >>

How to Cite "Depression or Recession? Determining Whether the U.S" Essay in a Bibliography:

APA Style

Depression or Recession? Determining Whether the U.S.  (2010, September 8).  Retrieved September 18, 2020, from https://www.essaytown.com/subjects/paper/depression-recession-determining-whether/18632

MLA Format

"Depression or Recession? Determining Whether the U.S."  8 September 2010.  Web.  18 September 2020. <https://www.essaytown.com/subjects/paper/depression-recession-determining-whether/18632>.

Chicago Style

"Depression or Recession? Determining Whether the U.S."  Essaytown.com.  September 8, 2010.  Accessed September 18, 2020.
https://www.essaytown.com/subjects/paper/depression-recession-determining-whether/18632.