An unusual recession

Authors

  • Axel Leijonhufvud University of California, Los Angeles, United States

Keywords:

Balance Sheets, Deleveraging, Financial Crisis, Recession, Subprime Crisis

Abstract

This recession is different. The balance sheets of consumers, businesses and banks are under pressure. The private sector is looking to reduce its debt and this counteracts Keynesian stimulus more than standard flow calculations would suggest. Bank deleveraging is undoubtedly the most dangerous event. Fiscal stimulus will not have a major effect as long as the financial system continues to deleverage.

JEL classification: E32 ; G01

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Published

2009-06-01

How to Cite

Leijonhufvud, A. (2009) “An unusual recession”, Ensayos Económicos, (53, 54), pp. 59–66. available at: https://bcra.ojs.theke.io/ensayos_economicos_bcra/article/view/341 (accessed: 29 April 2025).

Issue

No. 53, 54 (2009): Ensayos Económicos

Section

Articles