What is a recession and is the U.S. in one? Mercer economists explain – Mercer University

by | Aug 17, 2022 | Financial

As the country continues to grapple with high inflation, many Americans fear a recession. The Den talked to two Mercer University economists about what a recession is, how we got here and what we can do about it.

Dr. Antonio Saravia is an associate professor of economics and director of Mercer’s Center for the Study of Economics and Liberty. With more than 20 years of academic and consulting experience, his research focuses on institutional economics, political economy and the determinants of economic freedom.

Dr. Andres Marroquin is an associate professor of economics and faculty affiliate in the Center for the Study of Economics and Liberty. With over 15 years of experience in economics, his research centers on culture, institutions, entrepreneurship and development.

What is a recession?

Dr. Antonio Saravia

A recession is a significant downturn in economic activity reflected in a decline in the growth of gross domestic product, or GDP. GDP is the monetary value of all final goods and services produced in a country.

“The conventional definition has been if you have two consecutive quarters of negative growth in your GDP, then you are very likely in a recession,” Dr. Saravia said.

Some economists debate how many consecutive periods of decreased growth there should be, and others say additional indicators, like unemployment, impact whether a country is in a recession, Dr. Marroquin said.

So, are we in …

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