Some International Evidence on Double-Dip Recession
- 28 Downloads
With quarterly data on real gross domestic product for 21 nations from the Organization for Economic Co-operation and Development, this paper investigates the relatively neglected concept of double-dip recession. For this paper, a double-dip recession is defined as a second decline of real gross domestic product (GDP) after a trough of the economic cycle but prior to the reversion point or the previous peak level of real GDP. We find that while traditional or single-dip recessions constitute the majority of the recessions found for this paper, double-dip recessions are rather common occurrences across the world. However, higher-order multi-dip recessions, with three or more declines of real GDP before the reversion point is attained, are considerably less prevalent. We also find evidence of what we term trough-deepening multi-dip recessions.
KeywordsDouble-dip recession Reversion point
The authors thank an anonymous referee for valuable suggestions on an earlier version of this paper. We also thank Debra Walters and Aditya Pande for their assistance with data collection and manuscript preparation. Any errors which remain are wholly our own.
- Burns, A., & Mitchell, W. (1946) Measuring business cycles. New York: NBER. Available: https://www.nber.org/books/burn46-1
- Dornbusch, R., et al. (2011). Macroeconomics. New York: McGraw-Hill.Google Scholar
- Elwell, C. (2010). Double-dip recession: Previous experience and current prospect. Congressional Research Service Report for Congress. Available: https://fas.org/sgp/crs/misc/R41444.pdf
- National Bureau of Economic Research (2019a). The NBER’s business cycle dating procedure: Frequently asked questions. Available: https://www.nber.org/cycles/recessions_faq.html.
- National Bureau of Economic Research (2019b). U.S. business cycle expansions and contractions. Available: https://www.nber.org/cycles/cyclesmain.html.
- Organization for Economic Cooperation and Development (1960-2014). Quarterly National Accounts. Available: https://www.oecd-ilibrary.org/economics/data/oecd-national-accounts-statistics/quarterly-national-accounts_data-00017-en
- Rosenblum, H., & Atkinson, T. (2010). Gauging the odds of a double-dip recession amid signals and slowdowns. Economics Letters, 5, 12), 1–12), 4.Google Scholar
- U.S. Bureau of Economic Analysis (2019). “Table 1.1.6, real gross domestic product, chained dollars”. Available: http://www.bea.gov/data/gdp