GLOBAL RECESSION Meaning and
Definition
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A global recession is an economic phenomenon characterized by a widespread decline in economic activity across multiple countries, leading to a significant and prolonged contraction in global economic output. It is a severe downturn that affects various sectors including production, employment, consumption, and trade on an international scale.
During a global recession, countries experience a synchronized decline in their Gross Domestic Product (GDP), indicating a substantial decline in overall economic performance. This contraction is often a result of various factors, such as financial crises, a sharp decline in global demand, a collapse in international trade, or a combination of these factors.
The consequences of a global recession are far-reaching and can have a profound impact on businesses, households, and governments worldwide. It often leads to rising unemployment rates, reduced consumer spending, falling commodity prices, declining asset values, and lower government revenues. These effects create a vicious cycle, as reduced income leads to further reduced spending, further exacerbating the downturn.
To stimulate economic recovery and mitigate the negative impact of a global recession, governments and central banks typically implement expansionary fiscal and monetary policies. These measures may include lowering interest rates, increasing government spending, implementing tax cuts, and providing liquidity to financial institutions. The goal is to encourage economic activity and restore confidence in the financial system, thereby jumpstarting growth and gradually exiting the recessionary phase.
Common Misspellings for GLOBAL RECESSION
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Etymology of GLOBAL RECESSION
The word "global recession" has its etymology rooted in the combination of two terms - "global" and "recession".
1. Global: The term "global" originated from the Middle French word "global", which was derived from the Latin word "globus", meaning a "sphere" or "globe". It began to be used in English in the mid-17th century, referring to something that encompasses or relates to the entire world or a large part of it.
2. Recession: The term "recession" is derived from the Latin word "recessus", which means "act of going back" or "withdrawal". It started being used in its economic sense in the 1920s. In economics, a recession refers to a significant decline in economic activities over a sustained period, typically characterized by a decrease in GDP (Gross Domestic Product), income levels, employment rates, and trade.
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