. Economic crisis one calls the phase of a clearly negative development of the economic growth in the political economy. Besides one designates also negative developments with other macro-economic variables (e.g. Price level, occupation, flows of capital etc.) as economic crisis. An economic crisis can concern particulars or several national economies or even the entire world economy. The national economies concerned by an economic crisis suffer in the consequence mostly from social consequences such as unemployment, depletion of broad social classes or social unrests.

Related to the economic economic situation one differentiates three developments stagnation, recession and depression. Stagnation one calls a phase, in which a national economy does not grow and thus the output stagnates between two times. However it is contentious whether a phase of the stagnation can be called economic crisis. In a recession the economical output shrinks however over at least two sequential quarters according to general definition. Depression one calls a long persisting recession.

The reasons for growth crises are various. On the one hand they can be released by an economical demand, which is too small in relation to the economical offer (see Unterkonsumtionstheorie). This again can be to due to a breaking in being nominal oh question, i.e. a strong decrease of the consumer acceptance of the consumers (also as consumer strike designates). This again hangs off of the confidence of the consumers into the future economic development (i.e. growth prospects, security of the own job etc.). Affect themselves negatively here e.g. large natural catastrophes, Kriegsgefahr or terrorist attacks. Also scarcities of resources (e.g. in form of an oil price shock) lead to a restraint of the consumers. After keynesianischer aspect also the national demand for goods has a strong influence on the overall economic development; if the state lowers its public expenditures or if it increases the taxes, then this leads across a multiplicator effect to a decrease of the total demand and can release or strengthen an economic crisis thus.

Growth crises can be justified also by the offer side: So the dismantling of existing high over-capacities (the structure crisis in such a way specified) of uncertainty described too above and a decrease of the total demand can lead.

Concerning the price economic crises

Major item inflation

If a stagnation (or recession) arises together with continuous and high inflation, then one speaks of a stagflation. Also a high inflation (hyperinflation) can be called form of the economic crisis. Turned around also a durable decrease of the prices (deflation) is regarded as economic crisis.

Strong price increases can be released by a whole set of factors: A high economic growth (connected with a strongly expansive domestic demand) leads directly to a raising the price of of the goods. One speaks in such a case of an overheating; the strongly rising price increase leads to breaking in the total demand and thus possibly to a stagflation.

Also from the offer side it can come to a concerning the price economic crisis: If the prices for Vorprodukte (for example due to strong raw material price increases) rise strongly, then it comes at the same time to inflation pressure and decrease in demand.

Beyond that also a too expansive monetary policy can lead to inflation and the associated crisis symptoms.

Financial market crises

Major item financial crisis

In the recent past a multiplicity of economic crises on the international financial markets took place. To large extent if capital from a country is taken off, then one completely generally speaks of a financial crisis. If this is released by a collapse of the bank system or accompanies, one speaks also of a bank crisis. A further typical accompaniment of financial crises is the strong devaluation of the currency of a country (= monetary crisis).

If a country finances its standard of living over strong from the foreign country, then one speaks of a latent balance of payments crisis, since such a behavior is not on a long-term basis portable. Often a monetary crisis is (v. A. in developing countries) the direct result of a balance of payments crisis. If bank and monetary crisis arise together, then one speaks of a twin crisis.

Generally all financial crises released by uncertainty on the part of the investors over the Vorteilhaftigkeit of the plant in a country. The same applies with bank crises related to the individual bank and/or the banking. When reason for the crisis can thus that factor is designated, which is responsible for the increasing uncertainty. In case of of bank crises these are usually a badly functioning bank system, an insufficient state supervision of the banks or the bad overall economic situation, which lead to the fact that the banks must copy a large number at demands and so into a financial inclination turned out.

General financial and monetary crises can be attributed among other things to Ineffizienzen at the financial markets - e.g. in the form of blisterings. The possibility of a fast departure from financial capital is to attribute to small transaction costs. The shorter the average period of the capital put on in a country is, the more largely is the danger of a financial crisis. Financial crises are favoured by uncertain prospects relating to market conditions and by political uncertainties (danger of a Putsches, absence of right security, danger of expropriations etc.).

Particularly frequently strong the investments step at stock exchanges up e.g. in form of a black one on Mondays, Thursday or on Fridays.

Also a wrong economic policy can be responsible for financial crises: If the state or the central bank keeps a regime of firm rates of exchange upright to for a long time, although this no more does not fit the overall economic basic conditions, then the danger of a currency and thus flight of capital and a bank crisis rises.

Articles in category "Economic crisis"

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