econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 13 June 2015

The "Subpar" Recovery: A Longstanding Misunderstanding

by Lakshman Achuthan, Co-Founder and Chief Operations Officer of ECRI

It is a truth universally acknowledged - or nearly so - that the United States has experienced a subpar recovery from the Great Recession. As Fed Chairman Ben Bernanke put it at his farewell press conference, "we have been disappointed in the pace of growth, and we don't fully understand why."

Regardless, partisans - including economists - have jumped into the fray with ready explanations, finger-pointing and quick fixes, ranging from lower taxes or regulations to greater monetary or fiscal stimulus. Meanwhile, frustrated policymakers, misunderstanding what a "normal" recovery looks like, have kept acting on the premise that the economy can achieve "escape velocity," given the right policies. Considering the stakes, it is worth examining whether the historical evidence is consistent with that assumption.

Doing so reveals that the widely-derided pace of U.S. growth since the Great Recession actually lines up fairly well with historical recovery patterns. In other words, given past evidence, nothing more by way of growth is owed to us today by the business cycle.

How can this be? As we discussed in an earlier paper (Banerji and Achuthan, 2012), ECRI, in the summer of 2008 - prior to the Lehman collapse - "uncovered a long-term pattern of falling growth in GDP and jobs during successive expansions," going back at least to the 1970s. It is not the routinely alleged "subpar" nature of the recovery from the Great Recession, but this secular pattern of falling trend growth - rooted in demographics and productivity growth - that helps explain why the revival from the Great Recession has undershot popular expectations that the economy should have regained its pre-recession heights in short order.

Download the full January 2015 working paper by clicking here.

Click here for Historical News Post Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, using Livefyre just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.



You can also comment using Facebook directly using he comment block below.





Econintersect Contributors


search_box

Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.


Take a look at what is going on inside of Econintersect.com
Main Home
Analysis Blog
Democratic Development Lowers the Cost of Credit
Is Growing Household Debt An Economic Counter-Dynamic?
News Blog
'I Can Live With Either One': Palestine, Israel And The Two-state Solution
Where Snapchat's Users Come From
What We Read Today 26 February 2017
INAUGURATION DAY: A Bad Lip Reading Of Donald Trump's Inauguration
Did The Dodd-Frank Act Make The Financial System Safer?
A Close Look At The Decline Of Homeownership - Part Five Of Five
Do Institutional Investors Chase Returns?
Infographic Of The Day: How To Survive A Deadly Snake Bite
Early Headlines: Global Mfg 1970-2010, No Refugee Spike, GOP Health Proposal Leak, GOP Town Halls, Trump's Debt Decrease, Macron Gains, China's $9 Trn Moral Hazard, Americans Oppose Wall And More
Premium Seats At Premium Events Equal Premium Prices
Earnings And Economic Reports: Week Starting 27 February 2017
Time Crystals: How Scientists Created A New State Of Matter
Cost Of War Against ISIS Reaches 11 Billion Dollars
Investing Blog
Snapchat Is In The Money Burning Business
Technical Thoughts: How To Buy The Dips
Opinion Blog
Why Winning The French Presidential Election Could Be A Poisoned Chalice
Unintended Consequences Of Corporate Tax Incentives
Precious Metals Blog
Deflation And Gold: A Contrarian View
Live Markets
24Feb2017 Market Close: Wall Street Rose From Session Lows To Close In The Green Near The Unchanged Line, Short-Term Indicators And Analysts Questioning Continuing Bull Run
Amazon Books & More






.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government





























 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved