Periods That Might Be Classified as Global Recessions but Cannot Be Reasonably Called Recessions
In particular, its attempt to dismantle many of the constraints put on financial sector speculation following the Great Recession is clearly a threat to future macroeconomic stability.
Since 2010, the world economy has been in a process of recovery, albeit a slow one. The impact and severity of the effect of a global recession on a country varies based on several factors. For example, a country's trading relationships with the rest of the world determine the scale of impact on its manufacturing sector. On the other hand, the sophistication of its markets and investment efficiency determine how the financial services industry is affected. According to research, the United States would have suffered limited shocks to its economy, if the 2008 recession had not originated within its borders. This is mainly because it has limited trading relationships with the rest of the world. On the other hand, a manufacturing powerhouse like Germany would have suffered regardless of the robustness of its internal economy because it has vast number of trade linkages with the rest of the world.
There may be many new businesses (and business mod els) that would be successful in ordinary times but are unable to succeed due to a lack of demand or credit. In 2008, 43,500 businesses filed for bankruptcy, up from 28,300 businesses in 2007 and more than double the 19,700 filings in 2006 (Romer, P. 1986). The recession’s impact can also be seen in initial public offering (IPO) activity. Firms use capital raised from IPOs to expand activities. In 2008, there were just 21 IPOs for operating companies, down from an annual average of 163 in the four years prior (Ritter 2009). Furthermore, the median age of IPOs in 2008 was slightly higher than in past years, meaning that it is the more-established firms that are receiving the capital influx.
Murphy, Gregory C., and James A. Athanasou. 1999. The effect of unemployment on mental health. Journal of Occupational and Organizational Psychology. Vol. 72, pp. 83–99.
Nord, Mark, Margaret Andrews, and Steven Carlson. 2008. “Household Food Security in the United States, 2007.” Economic Research Report No. (ERR-66) USDA, November 2008, at http://www.ers.usda.gov/Publications/ERR66/.
Oreopoulos, P., Marianne Page, and Ann Huff Stevens. 2005. “The Intergenerational Effects of Worker Displacement.” National Bureau of Economic Research, Working Paper No. 11587: Cambridge, Mass.:NBER.
Ritter, Jay R. 2009. “Some Factoids about the 2008 IPO Market.” University of Florida, at http://bear.cba.ufl.edu/ritter/IPOs2008Factoids.pdf.
Romer, P. 1986. Increasing returns and long-run growth. Journal of Political Economy. Vol. 94, No. 5, pp. 1002-37.