For more information on depression, visit Britannica.com.
| Britannica Concise Encyclopedia: depression |
For more information on depression, visit Britannica.com.
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| Investment Dictionary: Depression |
A severe and prolonged recession characterized by inefficient economic productivity, high unemployment and falling price levels.
Investopedia Says:
In times of depression, consumers' confidence and investments decrease, causing the economy to shut down. The classic example of this occurred in the 1930s, when the Great Depression shook the global economy.
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| Financial & Investment Dictionary: Depression |
Economic condition characterized by falling prices, reduced purchasing power, an excess of supply over demand, rising unemployment, accumulating inventories, deflation, plant contraction, public fear and caution, and a general decrease in business activity. The Great Depression of the 1930s, centered in the United States and Europe, had worldwide repercussions.
| Real Estate Dictionary: Depression |
Economic conditions causing severe decline in business activity, reflecting high unemployment, excess supply, and public fear.
Example: Historically, at a national level, real estate construction activity experiences deeper depression than do general business conditions because a new house is the one thing consumers don't build in a depression. High interest rates can also cause a real estate depression because the interest rate is by far the largest component in monthly payments for housing.
| Columbia Encyclopedia: depression |
A depression develops when overproduction, decreased demand, or a combination of both factors forces curtailment of production, dismissal of employees, and wage cuts. Unemployment and lowered wages further decrease purchasing power, causing the crisis to spread and become more acute. Recovery is generally slow, the return of business confidence being dependent on the development of new markets, exhaustion of the existing stock of goods, or, in some cases, remedial action by governments. Depressions and recessions today tend to become worldwide in scope because of the international nature of trade and credit.
Insufficient numbers of profitable investment outlets, overexpansion of commerce, industry, or agriculture, a stock-market crash, the failure of a great banking or industrial firm, or war may be among the precipitating factors of a downturn. In antiquity, and even up to the 18th cent., depressions had chiefly noneconomic causes, such as wars and weather-induced crop failures. From c.1700 to 1825 economic crises were in the main speculative or commercial; since 1825 they have been increasingly industrial, although the Japanese recessions of the 1990s were caused in part by reduced consumer demand.
The economic crises of the 20th cent. saw the entry of governments into large areas of the economy that had previously been in private hands. Job reeducation programs, government employment of the previously unemployed, and increased public welfare responsibilities are among the programs adopted to alleviate depressions. Moreover, by applying Keynesian economic principles to public policy, governments have sought to affect the business cycle directly and prevent depressions. Large-scale public works expenditure (pump priming), tax cuts, interest rate adjustments, and deficit spending during recession are among the measures that have been taken to reduce the severity of periodic economic downturns such as those experienced in the United States in 1982 and internationally in the early 1990s and 2000s. In the collapse of the U.S. housing bubble that began in 2007, the uncertainties associated with mortgage-related securities and other financial instruments that had pervaded the international financial system undermined or threatened a wide range of financial institutions, leading to unprecedented measures by the Federal Reserve in an attempt to avoid a financial collapse and depression.
See also Great Depression.
Bibliography
See M. Bernstein, The Great Depression (1987); C. P. Kindleberger, The World in Depression, 1929-1939 (rev. ed. 1986) and Manias, Panics, and Crashes (rev. ed. 1989); W. C. Mitchell, Business Cycles and Their Causes (1989); A. W. Mullineux, Business Cycles and Financial Crises 1990).
| Economics Dictionary: depression |
A period of drastic decline in the national economy, characterized by decreasing business activity, falling prices, and unemployment. The best known of such periods is the Great Depression, which occurred in the 1930s.
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