Talk:Business cycle

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conjuncture?[edit]

Many of the interwiki links go to the word "conjuncture" in other languages, whereas Conjuncture only links to the corresponding words in Hungarian and Russian. Is there a reason for that? Are conjuncture and business cycle synonymous? Are there semantic differences between the word "conjuncture" in different languages?--87.162.55.153 (talk) 14:08, 5 October 2008 (UTC)

I don't know about Hungarian and Russian, but German and Dutch use Konjunktur / Conjunctuur to mean "business cycle". Conjuncture isn't normally used for this in English. Rd232 talk 11:15, 31 January 2009 (UTC)
I agree. "Coyuntura" is a standard term in Spanish for what English-language economists call the business cycle, as is "Conjoncture" in French. The English Wikipedia page on Conjuncture should be eliminated, or merged into 'Business cycle'. Rinconsoleao (talk) 16:46, 2 March 2011 (UTC)

Propose segregation of non-mainstream explanations[edit]

Right now we have the following organization:

  • 3.1 Exogenous vs. endogenous
  • 3.2 Keynesian
  • 3.3 Credit/debt cycle
  • 3.4 Real business cycle theory
  • 3.5 Politically-based business cycle
  • 3.6 Marxist economics
  • 3.7 Austrian school
  • 3.8 Henry George

This organization implies some kind of rough equality between the subject headings, but that is clearly not accurate. "Keynsian" explanations, in the broadest sense, are the mainstream view. Minskyite post-Keynsianism, and freshwater RBC, are both significant minority viewpoints, and taken seriously even by those who disagree with them. But the other four are pretty darned fringe. (I don't even know what George is doing in there, and the claim that he was "never refuted" sounds preposterous on its face.) I propose:

  • 3.1 Exogenous vs. endogenous
  • 3.2 Keynesian
  • 3.3 Credit/debt cycle
  • 3.4 Real business cycle theory
  • 3.5 Alternative theories
    • 3.5.1 Politically-based business cycle
    • 3.5.2 Marxist economics
    • 3.5.3 Austrian school
    • 3.5.4 Henry George

Thoughts? EvanHarper (talk) 19:03, 20 May 2010 (UTC)

I have implemented this change but an IP editor has reverted it. The explanation, "mainstream economics is a loose term" I do not find to be credible; it smacks of the continuum fallacy.
As a factual matter, does anybody dispute that the Keynesian, Fisher-Minsky, and freshwater macro explanations are far more respected, even by those who disagree with them? Does anybody expect that a database search for papers on these subjects would show drastically more papers examining the first three accounts, rather than the last four?
If this is not factually disputed, than is not WP:UNDUE clearly applicable? "Wikipedia should not present a dispute as if a view held by a small minority deserved as much attention overall as the majority view." Seems pretty cut-and-dry to me. EvanHarper (talk) 01:33, 26 May 2010 (UTC)
I concur with your analysis. I'm reverting back to your version. LK (talk) 04:46, 26 May 2010 (UTC)
Completely agree with EvanHarper. Rinconsoleao (talk) 21:44, 26 May 2010 (UTC)
The fact that the Marxian school was upheld as the 'mainstream' theory by the whole communist bloc as well as various socialist third-world countries for most of the last century (which constituted around half of the worlds population), and was and is still discussed by various scholars makes it ludicrous to dismiss it as 'fringe'. It has been the principal acknowledged theory critical of mainstream economists since Böhm-Bawerk. It's pretty preposterous to segregate Marxist analysis of business cycles from the 'respectable' accounts when Marxist theory took business cycles seriously around 70 years before the Keynesians (not to even mention that most of Keynesianism was inspired by Marx's M-C-M' cycle, as admitted in his 1934 first draft). Even Keynes himself admitted who his greatest opponent was: "The purpose of the book as a whole may be described as the establishment of an anti-Marxian socialism, a reaction against laissez-faire built on theoretical foundations totally unlike those of Marx in being based on a repudiation instead of on an acceptance of the classical hypotheses, and on an unfettering of competition instead of its abolition." (General Theory, ch. XXIII, section VI) Thus I disagree with both the implied link between a theory being mainstream and being 'credible', and the lumping of Marxist economic theory together with an obscure Henry George, whose section is in fact bigger than that concerning Marxist theory. Either all other explanations except the dominant Keynesian one should be classified in a different section, or the sentence "The remaining explanations given here are generally not considered credible by mainstream economists." should be changed to something more in the direction of "The remaining explanations given here are generally not supported by mainstream economists." to bring it in line with POV. —Preceding unsigned comment added by 94.101.5.195 (talk) 22:11, 3 September 2010 (UTC)
Henry George is of historical interest and his point of land tax is still worth considering, especially following the housing bubble. If you look at the Univ. of WI School of Business web site you will find a table showing the distortions in land values around the U.S. Also, the adoption of property taxes in many parts of the world was partly the result of George’s influential work, which was a best seller ‘’Progress and Poverty’’ (but necessarily not a good read.
Agreed that Marxist explanations are far from "fringe", but "alternative" is not a synonym for fringe. (See WP:FRINGE). I agree that the theories of Henry George get undue weight in this article (see my comment below), but not that he's "obscure". Compared to Marx, yes. But almost anybody is obscure compared to Marx. Yakushima (talk) 07:11, 27 January 2011 (UTC)


Along with the argument is an "alternative" vs. mainstream theory is putting the Austrian school as an alternative theory. Hayek won a Nobel prize for his work on Austrian school theory in relation to the business cycle. Former Fed. Chairman Alan Greenspan spoke of the importance of the Austrian school in modern day economic policies. Look at the debate over interest rate levels at the Fed. Half of the United States populace believes in Austrian school policies to an extent an thus it deserves mainstream recognition.

The problem with giving Austrian school mainstream recognition is they got everything they wanted from 1920-1932 and the US economy grew by less than 10% total in a period of 12 years. Then they got *nothing* they wanted from 1933-1945 and the economy grew by 190% over 12 years. "Unbiased" should also be fact-based.70.90.204.42 (talk) 17:03, 14 December 2014 (UTC)

Those are very weak arguments. It doesn't matter what half of the population think but what scientists in the field who publish papers think. It's encyclopedia after all (see NPOV, we need reliable sources, not urban wisdom or opinions of American politicians). Austrians and Marxists aren't mainstream economists these days and from reading this article and few others one can form the impression that economists world is divided 50:50 among "mainstream" and "Austrian". I have an impression influence of Austrian school is very strong on wikipedia and it's purposeful actions to distort NPOV.

Georgist section overlong?[edit]

Although I believe Henry George seldom gets his due, giving his business-cycle theories undue weight in this article is not an appropriate way to rectify the injustice. Transcluding a section from some main article might be better than reiterating his entire viewpoint here. Yakushima (talk) 07:11, 27 January 2011 (UTC)

While the section devoted to Goergism is long, the reason is that we have just gone through a land speculation boom, and in some locations and countries, a bust of historic proportions. Beyond that, Goergism does not fit as well into business cycles because George was mainly concerned with the disproportionate rise in land values that eventually leads to impoverishment of the citizenry, such as we now have in some places, like California and certain European and Asian cities. Phmoreno (talk) 02:47, 11 November 2011 (UTC)

Spectral Analysis[edit]

"Recent research employing spectral analysis has confirmed the presence of Kondratiev waves in the world GDP dynamics at an acceptable level of statistical significance..." Sorry, but spectral analysis, based on Fourier methods or similar techniques, cannot handle non-stationary signals like GDP - which is not like energy waves, but alters in many ways over time. If the attributed research used some form of Discrete Fast Fourier transform, they needed a window function to detect results. But for such a classically dynamic signal, any window will predispose conclusions. It's not impossible to detect macroeconomic cycles mathematically, but introducing spectral analysis is a red herring. BrianMC — Preceding unsigned comment added by 208.80.117.214 (talk) 07:05, 29 August 2013 (UTC)

I can see that Fourier transforms can be difficult to use for this kind of work. I'd have to check the research, but it should be possible to use filter theory to establish whether cycles do exist within a given range of frequencies.GliderMaven (talk) 02:10, 31 January 2014 (UTC)

Trade Cycle[edit]

When I studied economics about 45 years ago, this was referred to as the trade cycle. Trade cycle still gives a large number of hits in Google. Although I agree that business cycle is now more current, should there not be a reference to this term? Everybody got to be somewhere! (talk) 00:49, 8 March 2013 (UTC)

Georgism[edit]

"Land speculation slows the economy in two ways. It increases production costs by making land in general more expensive (shifting the Aggregate supply (AS) curve upward) "

I think the author meant "Aggregate demand" instead of "Aggregate Supply". Otherwise the proposition seems meaningless.

-- 77.238.18.5 (talk) 12:48, 7 May 2013 (UTC)Michele77.238.18.5 (talk) 12:48, 7 May 2013 (UTC)

Illustration of the business cycle[edit]

I have removed the illustration of a business cycle, because its labels are seriously misleading. Not every business cycle has a boom at its peak level of growth, and not every cycle has a depression at its trough. The graph failed to label either of its coordinates, making it at best ambiguous and at worst incomprehensible to beginners. — Aetheling (talk) 21:31, 2 June 2014 (UTC)

Yield curve section[edit]

Recently a section was added to this article, right after the introduction. The new section presented the "yield curve" explanation for the cause of business expansions and contractions, with data provided in a table to back up the claims. Since this entire section is just one of many possible explanations of the business cycle, I moved it into the section on Explanations. I took the opportunity to fix a spelling error and to break up a couple of run-on sentences. There are still two external links that still need to be converted to footnotes. — Aetheling (talk) 21:31, 2 June 2014 (UTC)

Kitchin inventory cycle - and Infobox[edit]

"Kitchin inventory cycle of 3 to 5 years". The source given says 40 months but can vary. I'm not saying the range is wrong but it's not in the source (that I could see). It mentions 40 months however for the minor cycles and the major could be double or even triple making the (major) cycle 10 years (or more?). Should the major cycles be mentioned? And/or the cycle clarified to be the major one (not including major one).

It seems to me that the cycle could be getting shorter, it I understand what it is about correctly, for say electronics and JIT-intentory. Saying so would be WP:OR however. Anyone know? Could it be in some cases two or one year?

In the box it says "period" not "period in years". Implied maybe, and I'm ok with that - I just first got to the page about the cycle and it only mentioned months and 40 (and no range - while it fits in it after convertion..). comp.arch (talk) 19:56, 17 October 2014 (UTC)

External links modified[edit]

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Dr. Pagan's comment on this article[edit]

Dr. Pagan has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:


I have reservations about a lot of this.

There are at least three ways of talking about the ups and downs of an economy. One of these is oscillations. This is the basis of the Samuelson model mentioned in reference 25. It basically constructs a model that has complex roots in the autoregressive process describing economic activity and so these produces oscillations. Then there are cycles. These are detected by turning points in activity – peaks and trough. This is the Burns and Mitchell definition mentioned and seemingly approved of in the entry. B and M expanded it to look at a number of series rather than a single one ( although they did say GDP was the best single measure but they didn’t have it at the frequency they wanted for cycle dating, which was monthly). Band M were always looking for the turning points that ushered in expansions and contractions in the level of economic activity . Now it is true that oscillatory processes have turning points but they depend on the roots of the system and not the shocks coming into the autoregressive process. Turning points in the series themselves depend on the shocks. Finally there is the idea of fluctuations which focuses on the volatility in the changes in activity. All of these come up in the article but there is no clear statement that they are different ways of thinking about ups and downs. The writer is correct that people looking at fluctuations often talk about business cycles but it is a very different way of thinking. Related to this then is a problem about measurement. The NBER, which the writer says is the arbiter of business cycles in the U.S., look at turning points in the level of economic activity, just as Burns and Mitchell did. They do not subtract long-run growth ( whatever that is and it is isn’t defined even though it is used as a basis of figure 3 when finding turning points. If they did they would be finding turning points in what the NBER call the growth cycle. There are more peaks and troughs in the growth cycle than the business cycle as one can see from the figures 2 and 3. So the first statement that the business cycle is “..the movement of GDP around its long-term growth trend” is contrary to what the NBER do and what Burns and Mitchell did. In contrast fluctuations often focuses on the variance of something like GDP growth less its “long term trend”, and there are many ways of defining the latter. I have never liked the term. The statement that “business cycles are usually measured by considering the growth rate of GDP” is not entirely accurate. It is the level of GDP that is considered. The growth rate is relevant only in that, if it is positive, activity is rising and if negative activity is falling. I am dubious about the definition of a boom and bust cycle. In most work on this booms are really about how big the expansion is rather than how rapid it is. Busts are big declines rather than being steep. I think steepness is a separate (important) characteristic. The history in the article seems to me to be quite good although debateable at times e.g. that the Great Depression featured market saturation. The classification of cycles is o.k. I think the originators of these thought in terms of oscillations but realized that you wouldn’t see them precisely in the data because of shocks. I don’t like the reference to Lucas who is quoted as saying that “the central problem of depression prevention has been solved “ and then the comment is made that “ we had a 2008-2012 global recession”. I am not sure where the 2012 comes from. The US recession was over in 2009 ( NBER) and global growth was 5.4 in 2010, 4.23 in 2011 3.43 in 2012…I think Lucas is right about depressions but recessions create issues when fiscal policy is hard to use. Monetary is pretty weak as we have seen. This looks point scoring to me and demeans the entry. I am not sure what a “grand peak year” is. Spectral methods are about oscillations. I have trouble seeing that they can confirm anything. They may reject the idea based on evidence but confirmation is a different thing. The comment about Friedman that it is only monetary phenomena ( excepting some supply side shocks) is about the causes of cycles not their existence. I rather felt that all of the proposed explanations were hard to follow. This has always been an issue e.g. what does under-consumption mean. I think it true that all of the “theories” have seen sense e.g. the Austrian focus on credit, George on property. But not all cycles come from these ideas. They may be important for a particular expansion and contraction. I have to say that the yield curve material was not easy to follow. The idea is that an inverted yield curve can signal a recession. An inverted curve is when the short-rate (S)exceeds the long rate(L). So there was something odd about the reference to Estrella and Adrian (later referred to as “he”), who are said to say that when S-L<0 or <93 basis points then a rise in unemployment occurs. This seems to be the wrong way around. Surely it is s-l>93 points. Then the table shows max inversion ( and now I think they are looking at L-S as the numbers are given as negative). But for none of the 1970,1990,2001,2008-9 recessions did one get close to 93? Maybe it was just whether there is an inversion that is important. I have to say that it seemed odd to bring this in after all the more general theories- Austrian etc. It seems more appropriate to be in a section on forecasting recessions. I wasn’t sure what to make of the mitigation section. It is clear from the GFC that there is still a belief that one should mitigate but if it is just left to monetary policy it is not clear how successful this can be.


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  • Reference : Don Harding & Adrian Pagan, 2009. "An Econometric Analysis of Some Models for Constructed Binary Time Series," NCER Working Paper Series 39, National Centre for Econometric Research, revised 02 Jul 2009.

ExpertIdeasBot (talk) 14:33, 19 May 2016 (UTC)

Dr. Rios-Rull's comment on this article[edit]

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The history of the theory is not that interesting and should be later in the article

Exogenous vs. endogenous is not very useful. it is better to say that most economists see them as the result of shocks that hit the economy (productivity, preference, monetary, foreign, fiscal) and of the response of the various economic agents to it. Economists create artificial economies or models with various frictions to understand how recessions occur.

Another (minoritary) group of economists sees the recessions as the result of arbitrary outcomes that cannot be predicted as we cannot pinpoint what is normal to happen even in the absence of uncertainty. This is what is referred to as multiple equilibria.

The distinction between new keynesians and real business cycle is a lot less important than what is implied.

Marxian and Georgism should not really be there


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  • Reference : Jose-Victor Rios-Rull & Frank Schorfheide & Cristina Fuentes-Albero & Raul Santaeulalia-Llopis & Maxym Kryshko, 2009. "Methods versus substance: measuring the effects of technology shocks on hours," Staff Report 433, Federal Reserve Bank of Minneapolis.

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Dr. Gomes's comment on this article[edit]

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This article is well written, clear and informative about a series of aspects relating business cycles: what they represent, their origins, the main authors who have approached them, their sources, and the instruments available to smooth them.

A point that may be included in this article, and that is not mentioned in its current form, relates to the recent new-keynesian literature that attributes business fluctuations to several types of sluggishness, namely the stickiness in prices, wages and information. A few meaningful references at this level include: • Akerlof, G.A., and J.L. Yellen (1985). “A Near-Rational Model of the Business Cycle with Wage and Price Inertia.” Quarterly Journal of Economics, vol. 100, pp. 823–838. • Mankiw, N.G. (1985). “Small Menu Costs and Large Business Cycles: A Macroeconomic Model of Monopoly.” Quarterly Journal of Economics, vol. 100, pp. 529–537. • Mankiw, N.G. and R. Reis (2002). “Sticky Information versus Sticky Prices: a Proposal to Replace the New Keynesian Phillips Curve.” Quarterly Journal of Economics, vol. 117, pp. 1295-1328. • Sims, C.A. (1998). “Stickiness.” Carnegie-Rochester Series on Public Policy, vol. 49, pp. 317-356.


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  • Reference 1: Gomes, Orlando, 2007. "Consumer confidence, endogenous growth and endogenous cycles," MPRA Paper 2883, University Library of Munich, Germany.
  • Reference 2: Gomes, Orlando, 2012. "Information stickiness in general equilibrium and endogenous cycles," Economics Discussion Papers 2012-46, Kiel Institute for the World Economy.

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Dr. Gallegati's comment on this article[edit]

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figure 1 uin log


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  • Reference : Russo, Alberto & Riccetti, Luca & Gallegati, Mauro, 2013. "Increasing Inequality and Financial Fragility in an An Agent Based Macroeconomic Model," MPRA Paper 51528, University Library of Munich, Germany.

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Dr. Nuno Barrau's comment on this article[edit]

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The reference to the yield curve and to Georgism does not seem to fit well. These are marginal explanations and the article gives the impression that they are as relevant as Keynesianism or RBC. I suggest to remove them or, at best, to summarize them in a new point named Öther explanations"


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  • Reference : Galo Nuno, 2009. "Technology, convergence and business cycles," Banco de Espaa Working Papers 0922, Banco de Espaa.

ExpertIdeasBot (talk) 18:49, 27 June 2016 (UTC)

Dr. Altug's comment on this article[edit]

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Comments on the following sections:

1) Classification by periods

Change the sentence: 'Later [when?], economist Joseph Schumpeter (1883-1950) argued that a Juglar cycle has four stages.' as 'In his Business cycles (1939), economist Joseph Schumpeter (1883-1950) argued that a Juglar cycle has four stages.

Add the reference or note: Schumpeter, J. (1939). Business Cycles: A Theoretical, Historical, and Statistical Analysis of the Capitalist Process 2 vlms. New York: McGraw Hill

2) Occurrence

Add the citation to the following sentence: `The first of these crises not associated with a war was the Panic of 1825.'[citation needed]

Morgan, D. and J. Narron (2015). Crisis Chronicles: The Panic of 1825 and the Most Fantastic Financial Swindle of All Time, Liberty Street Economics, http://libertystreeteconomics.newyorkfed.org/2015/04/crisis-chronicles-the-panic-of-1825-and-the-most-fantastic-financial-swindle-of-all-time-.html#.V2VJhaIj4TI

3) Politically based business cycle:

I suggest putting references to the works of Nordhaus (1989) and Alesina, Roubini, and Cohen (1997) regarding opportunistic and partisan political business cycles at the end of the sentence that begins as 'In recent years, proponents of the "electoral business cycle" theory [who] ...'

Nordhaus, W. (1989). Alternative Models of the Political Business Cycle, in Brookings Papers on Economic Activity 2, 1-50, The Brookings Institution.

Alesina, A., N. Roubini and D. Cohen (1997). Political Cycles and the Macroeconomy. Cambridge, MA: The MIT Press.

4) Cycles or fluctuations?

I suggest putting the reference Friedman, M. and A. Schwartz (1987). "Money and Business Cycles," In Money in Historical Perspective, p.25-77, University of Chicago Press for the National Bureau of Economic Research http://www.nber.org/chapters/c7496

5) Mitigating an economic downturn":

I suggest adding the following two references at the end of the sentence: `The stagflation of the 1970s provided striking support for their theories, defying the simple Keynesian prediction that recessions and inflation cannot occur together.'[original research]

Friedman, Milton. “The Role of Monetary Policy.” American Economic Review 58, no. 1 (1968): 1–17.

Phelps, Edmund S. “Phillips Curves, Expectations of Inflation and Optimal Employment over Time.” Economica, n.s., 34, no. 3 (1967): 254–281.


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  • Reference : Sumru Altug & Fabio Canova, 2012. "Do institutions and culture matter for business cycles?," Economics Working Papers 1314, Department of Economics and Business, Universitat Pompeu Fabra.

ExpertIdeasBot (talk) 20:33, 1 July 2016 (UTC)

Dr. Pappa's comment on this article[edit]

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missing references:

Frontiers of Business Cycle Research Edited by Thomas F. Cooley Nothing mention of business cycles and price rigidities


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  • Reference : Fabio Canova & Evi Pappa, 2005. "The elusive costs and the immaterial gains of fiscal contraints," Economics Working Papers 928, Department of Economics and Business, Universitat Pompeu Fabra.

ExpertIdeasBot (talk) 16:09, 11 July 2016 (UTC)