The Story Of Economic Depression Definition Has Just Gone Viral! | economic depression definition

Economic depression is an extended, sustained, ongoing slump in economic activity in a country or region. It's a far more severe economic slump than a typical recession, which, as the name implies, is a brief, short-term decline in economic activity, typically over a period of about six months. There is no such thing as a “good” or “bad” recession; virtually any decline in economic activity is viewed negatively by economists. In fact, even recessions that are considered mild by international standards (as opposed to an extreme case like the Great Depression) can have major and lasting effects on the country in which they occur, because they tend to sap the strength of the country's financial system.

It's important to understand what constitutes the most severe economic depression. Economists tend to use two major types of economic depression: widespread economic breakdown that has been going on for several years, and short-term disturbances that happen suddenly and with no prior warning. Distressful economic situations are sometimes associated with a rise in inflation and asset devaluation. They also usually involve a drop in employment, a reduction in economic growth, and the rapid rate of population decline. These conditions are generally considered severe when they occur alongside other signs of distress such as increasing ratios of debt to income, a drastic decrease in financial assets, or insolvency.

See also  The Modern Rules Of Cyclical Unemployment Example | cyclical unemployment example

The second, more negative definition of economic depression is caused when an economic decline occurs suddenly and with no prior warning. This kind of depression is often referred to as a shock depression, because it can have very dramatic and unexpected consequences on the economy. Extreme short term examples include the recent economic depression experienced in South Africa during the December 2021 economic crisis, and the United States during the early 1930s. These circumstances each had very adverse, long term effects on the countries involved.

Economic depression tends to be much harder to identify than other kinds of economic hardships, mainly because the symptoms don't usually come about until much later on in time. It's not uncommon for a country to suffer from depression for years before anyone starts to suspect a problem, and then to see the problem slowly worsen. Another problem is that depression doesn't necessarily have to involve economic decline. In fact, it can involve an overall decline in living standards, or merely the slow, inevitable loss of some economic opportunities.

International relations experts tend to disagree on which kinds of circumstances would fall under the definition of economic depression, although most agree that it is an undesirable condition. This is because it can have ramifications not only for the countries involved but for the world as a whole. When a country experiences an economic depression, it can significantly impact the global supply, demand, and currency movements. This can lead to a weakening of international economic relationships, which can effect the strength of the American dollar and interest rates in the US, for instance. If the US begins to experience economic depression, this can also have repercussions for the rest of the world, since the US is one of the largest sources of financial activity.

See also  The Modern Rules Of Sharing Economy | sharing economy

There are some countries that experience economic depression and need assistance more than others. For example, Cuba is in a severe state of economic ruin, with the Castro government struggling to prop up the flagging economy. Some believe economic depression to be a legitimate phenomenon, although others think it to be a passing phase that can't be defined as such. The best way to define what you mean by economic depression is probably to talk to a professional who can give you a good definition of what you're going through.

Great Depression: Causes and Definition HISTORY.com

Great Depression: Causes and Definition HISTORY.com | economic depression definition

Recession vs Depression: What’s the Difference? Definition – economic depression definition | economic depression definition

Economic Recession (Definition, Types) Top Examples of Recession - economic depression definition

Economic Recession (Definition, Types) Top Examples of Recession – economic depression definition | economic depression definition

Economic Depression - Definition - Economics Help - economic depression definition

Economic Depression – Definition – Economics Help – economic depression definition | economic depression definition

Economic Depression - Definition - Economics Help - economic depression definition

Economic Depression – Definition – Economics Help – economic depression definition | economic depression definition

Recession vs Depression: Definition, Difference - economic depression definition

Recession vs Depression: Definition, Difference – economic depression definition | economic depression definition

What is an economic depression? Definition and examples - Market - economic depression definition

What is an economic depression? Definition and examples – Market – economic depression definition | economic depression definition

Economic Depression: Definition, Causes, Prevention - economic depression definition

Economic Depression: Definition, Causes, Prevention – economic depression definition | economic depression definition