A critical consideration in understanding business cycles is the amplification and propagation of shocks to the economic system.
Many recessions seem to arise without a clearly identifiable cause or at least one of significant magnitude to justify an economy-wide recession.
How can a small shock cause large changes in the economy?
What are the mechanisms that amplify a modest shock such that a serious recession ensues?
Despite the persistent search for a mechanism for business cycle amplification and propagation, much research in business cycles seems to ignore the likely role of the financial system.
If a shock to the economy inhibits the capital allocation capability of an economy, then a seemingly mild shock may be amplified through its impact on new investment thereby snuffing out economic growth and causing a recession.
This book provides new research on the field of recessions from around the globe.
- Format: Hardback
- Pages: 174 pages, tables & charts
- Publisher: Nova Science Publishers Inc
- Publication Date: 05/05/2009
- Category: Financial crises & disasters
- ISBN: 9781604568660