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During the recovery period, the economy goes through a process of economic adaptation and change to new circumstances, including the reasons that caused the recession in the first place, as well as the new policies and regulations enacted by governments and central banks in reaction to the recession.
Business cycles are a type of fluctuation found in the aggregate economic activity of nations that organize their work mainly in business enterprises: a cycle consists of expansions occurring at about the same time in many economic activities, followed by similarly general recessions, contractions, and revivals which merge into the expansion ...
American popular media labeled the Great Recession the "mancession" because of the many male dominated industries affected (e.g., construction) although many more men were hired than women during the recovery period. [58] By the end of 2009 the unemployment rate for men was 10.7%, while women's unemployment peaked at 8.4%. [59]
During a recession, output production temporarily falls due to lack of demand, and as a result fewer workers are needed. [9] This was a popular explanation of unemployment during the Great Depression, when many believed unemployment to be "no fault" of the individual workers. [10]
Economic recovery began in 1983. Both fiscal stimulus and money supply growth were policy at this time. A five- to six-year jump in unemployment during the Volcker disinflation suggests Volcker may have trusted unemployment to self-correct and return to its natural rate within a reasonable period. [citation needed]
An economic depression is a period of carried long-term economic downturn that is the result of lowered economic activity in one or more major national economies. It is often understood in economics that economic crisis and the following recession that may be named economic depression are part of economic cycles where the slowdown of the economy follows the economic growth and vice versa.
Economic contraction and expansion relate to the overall output of all goods and services, while the terms "inflation" and "deflation" refer to increasing and decreasing prices of commodities, goods and services in relation to the value of money. [citation needed] On the microeconomic level, expansion may involve enlarging the scale of a ...
Deflation usually happens when supply is high (when excess production occurs), when demand is low (when consumption decreases), or when the money supply decreases (sometimes in response to a contraction created from careless investment or a credit crunch) or because of a net capital outflow from the economy. [11]