Recession
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A recession implies at least two quarters of negative economic activity. [1] It is a decrease in an economy's employment and output and the income of its citizens. There may also be a decline in personal and business optimism, and a decline in the rate of consumption and capital investment in business activity.
The generally accepted definition of a recession is based on the decline in gross domestic product (GDP) for two consecutive quarters. The National Bureau of Economic Research makes an announcement on whether the United States economy has entered a recession.
Several strategies exist for dealing with recession:
- Keynesian economics indicate deficit spending by government will deal with any short term losses by business.
- Supply-side economics indicate government tax cuts will promote business capital investment.
- laissez-faire economics recommend the government do nothing and not interfere with market forces.
