Economic Cycle
An economic cycle is a pattern of economic activity that is characterized by alternating periods of expansion and contraction. It is also known as the business cycle. The cycle is typically measured by considering the growth rate of real gross domestic product (GDP). During an expansion, GDP growth is positive, while during a contraction, it is negative. The economic cycle is typically divided into four phases: expansion, peak, contraction, and trough.
History of the Term
The concept of the economic cycle has been around since the early 19th century. The first person to use the term “business cycle” was the British economist William Stanley Jevons in 1879. Jevons was the first to recognize the cyclical nature of economic activity. He argued that economic activity was characterized by alternating periods of expansion and contraction. Since then, economists have studied the economic cycle in order to better understand its causes and effects.
Comparisons
| Phase | GDP Growth |
|---|---|
| Expansion | Positive |
| Peak | High |
| Contraction | Negative |
| Trough | Low |
Summary
The economic cycle is a pattern of economic activity characterized by alternating periods of expansion and contraction. It is typically measured by considering the growth rate of real gross domestic product (GDP). The cycle is typically divided into four phases: expansion, peak, contraction, and trough. To learn more about the economic cycle, you can visit websites such as the Federal Reserve Bank of St. Louis and the U.S. Bureau of Economic Analysis.
See Also
- Business Cycle
- Gross Domestic Product (GDP)
- Inflation
- Unemployment
- Monetary Policy
- Fiscal Policy
- Interest Rates
- Recession
- Depression
- Economic Growth
