Business Cycles

An important feature of the working of a capitalist economy is the existence of alternating periods of prosperity and depression generally referred to as a ‘business cycle’ or ‘trade cycle’. In a business cycles there are wave like fluctuations in aggregate employment income, output and price-level. The term business cycle has been defined in various ways by different economists. 

Note: This is published for the internal use (of St. Philomena's College students) only and hence requires verification. 

1. Proceed to Full Article (Registered Students)

2. Register for Verification (New Students)

Phases of the Business Cycle

1. Recovery: 

We start from a situation when depression has lasted for some time and revival phase or the lower-turning points starts. The ‘originating force’ or ‘starters’ may be exogenous or endogenous forces. Suppose the semi-durable goods wear out which necessitates their replacement in the economy, it leads to increased demand investment and employment increase. Industry begins to revive. Revival also starts in related capital goods industries.

Note: This is published for the internal use (of St. Philomena's College students) only and hence requires verification. 

1. Proceed to Full Article (Registered Students)

2. Register for Verification (New Students)