I would like to know the characteristics of economic downturn. Is downturn the same as recession? and which countries experience economic downturn from 2010 to 2018?
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2$\begingroup$ This is an English language usage question. “Recession” has (multiple) formal definitions in economics (e.g., the NBER has criteria for defining a recession in the United States.) “Downturn” is an English word that is used a lot in commentary, but has no formal definition. Although most would consider a formal recession to be a “downturn,” it might also be a period of lower-than-usual GDP growth, that does not qualify as a recession. Since this is a loose definition, there cannot be a definitive list of “downturns.” $\endgroup$– Brian RomanchukJul 10, 2020 at 16:08
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1 Answer
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A downturn is characterized by a time period of lower economic growth or economic contraction. The term economic downturn has no formal definition and can mean many things including a recession. An economic downturn might also be used to describe periods of lower economic growth. On the other hand a recession is a specific term that is often used to describe two consecutive quarters of economic contraction.
For example, Australia has experienced near continuous growth since the early 1990s. In that three decade span Australia has experienced individual quarters of contraction but never two consecutive quarters of contraction. So it can be said that Australia has experience brief economic downturns but no recessions in the past decades.
Not completely the same as a list of countries that have experience economic downturns, but Wikipedia has a list of economic crisis by decade. A few notable examples in the 2010 to 2018 time frame are Brazil, Greece, and Venezuela.
Here is a chart from a World Bank research paper that shows the number of countries in recession by year.
This definition comes from the site Market Business News and offers a more precise definition of economic downturn.
An economic downturn, or a downturn, occurs when the value of stocks, property, and commodities fall, productivity either grows more slowly or declines, and GDP (gross domestic product) shrinks, stands still or expands more slowly.
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$\begingroup$ Let say if a country experienced a GDP growth of 5.0% in the previous year, but the next year it still experienced a growth but at a lower percentage such as 3.5%, can we consider this as a downturn? $\endgroup$ Jul 11, 2020 at 5:24
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$\begingroup$ It is tough to give an exact answer because the term is so ambiguous. The best I could say is maybe. Some might call it an economic slowdown. $\endgroup$– Scc33Jul 11, 2020 at 14:25
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$\begingroup$ I added some clarification and a graph to the answer that I think helps explain this. Yes this might be considered a downturn (see graph). $\endgroup$– Scc33Jul 11, 2020 at 14:33