Toto: Created English encyclopedia entry on Economic Recession following Wikipedia-style standards

2026-10-06T04:14:25Z

Created English encyclopedia entry on Economic Recession following Wikipedia-style standards

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An '''economic recession''' is a significant decline in economic activity that lasts for more than a few months, typically reflected in falling [[gross domestic product]], employment, income, and industrial production. A common rule of thumb, used in some countries, defines a recession as two consecutive quarters of negative GDP growth.<ref name="wiki">Wikipedia contributors, "Recession".</ref>

== Definition ==

A recession is a period of contraction in the [[Business Cycle|business cycle]]. It is characterised by:

* Falling output and GDP.
* Rising [[unemployment]].
* Declining consumer spending and business investment.
* Reduced industrial production and trade.
* Falling business and consumer confidence.

== Causes ==

Recessions may be triggered by a variety of shocks:

{| class="wikitable"
! Cause
! Description
|-
| Demand shocks
| A sharp fall in consumption or investment.
|-
| Supply shocks
| A sudden rise in input costs, such as oil prices.
|-
| Financial crises
| Credit crunches, bank failures, or asset price collapses.
|-
| Policy errors
| Excessive monetary tightening or fiscal contraction.
|-
| External shocks
| Global downturns or geopolitical events.
|}
== Effects ==

Recessions impose significant costs on households and firms. Unemployment rises, incomes fall, and poverty may increase. Governments typically respond with [[Expansionary Fiscal Policy|expansionary fiscal policy]] and central banks with expansionary [[Monetary Policy|monetary policy]] to stimulate demand and speed recovery.<ref name="wiki"/>

== See also ==

* [[Economic Depression]]
* [[Economic Recovery]]
* [[Business Cycle]]
* [[Unemployment]]
* [[Fiscal Policy]]

== References ==

<references />

[[Category:Economics]]
[[Category:Macroeconomics]]
[[Category:Business cycle]]

Economic Recession - Revision history

Toto: Created English encyclopedia entry on Economic Recession following Wikipedia-style standards