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    in the title. I read somewhere that a prolonged period of slow economic growth is worse than a big recession in the short term then a recovery.

    Thanks
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    (Original post by TomTeeTom)
    in the title. I read somewhere that a prolonged period of slow economic growth is worse than a big recession in the short term then a recovery.

    Thanks
    This should be in the academic forum.
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    with all those qualifications in economics could you answer it for me please
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    (Original post by TomTeeTom)
    with all those qualifications in economics could you answer it for me please
    no: you are in the wrong forum.
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    What a horrible typo
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    (Original post by Paulwhy)
    no: you are in the wrong forum.
    so you wont answer because im in the wrong forum. You are an ass
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    Because in a recession, you have spare capacity available for demand management policies to kickstart the economy. Recessions are generally caused by lack of demand.

    In a period of slow economic growth, consumers and businesses often believe the economy is in recession when in actual fact it's not (economics is as much about expectations as it is about what's happening in the present). So they will cut back spending, cut jobs, cut wages and any demand management policies will result in unsustainable short term growth. This becomes a self-fulfilling process, much like a wage-price spiral.

    That's my theory anyway...
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    hmmm not sure it is a bad thing certainly very rapid growth is unsustainable like the rise and fall of japan during the 90's. Steady low growth should encourage investment and then as an extention of this a continuation and increase in said growth. However extremely low growth is a bad thing as productivity increases by around 2% each year meaning that unemployment can increase leading to a contraction in the economy.
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    (Original post by TomTeeTom)
    so you wont answer because im in the wrong forum. You are an ass
    Sorry you feel like that. But what other incentives are there to encourage you to post in the correct forum?

    (Original post by TomTeeTom)
    I read somewhere that a prolonged period of slow economic growth is worse than a big recession in the short term then a recovery.
    Only the original source can say why they think that: we can only be 2nd best. However argument it was making could be:
    with 2nd option situation if LR growth is higher then GDP should soon overtake situation 1. e.g. (-2,+2,+2) results in a net increase of 4% whilst (+1,+1,+1) results in a net increase of 3%.
    i
 
 
 
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