business cycle

Recurring economic cycles, involving a period of above-average growth (expansionist phase), followed by one of lower than average growth (recession), then one of negative growth (depression). Modern economists generally assume that the ‘normal’, ‘classic’, or ‘Juglar’ cycle lasts approximately five years, but there is no consensus as to its causes, indeed there are some who have argued that the fluctuations themselves are random rather than uniform in character. The Russian-born American development economist Simon Kuznets also identified a longer economic cycle (‘Kuznets cycle’) lasting some fifteen to twenty years. So-called Kondratieff cycles (named after the Russian economist who developed the idea in the 1920s) consist of ‘long wave’ cycles of boom and recession averaging half a century or so, fuelled by major technological and industrial advances, such as the advent of steam power. These cycles are often linked to developments in the world-system (see, for example,, ‘World-Systems Analysis’, Annual Review of Sociology, 1995).