Business Dictionary defines a recession as a period of contraction in the gross domestic product (GDP) for six months or longer, during which retail sales fall, wages stagnate and unemployment rises. EPI adds that recessions also impact education, job opportunities and the formation of new businesses.Know More
Towers Watson indicates that recessions are generally marked by mass layoffs as companies struggle to retain all their staff. The workers who remain are less likely to voluntarily quit their jobs, and it is harder for young workers entering the workforce to find jobs.
Big businesses experience a decline in sales revenues and start to cut costs, including the purchase of new equipment, research and development, and advertising. These efforts to cut costs, in turn, affect other businesses, according to Investopedia.
During a recession, companies may see a decline in their stock prices and shareholders' dividends. As a result of declining profits, companies become less able to repay their debts on time, which can lead to their credit ratings being damaged. Companies that are consistently unable to service their debts declare bankruptcy and go out of business. Smaller businesses are especially susceptible to bankruptcy during recessions, since they typically don't have large cash reserves, notes Investopedia.Learn more about Economics
Greece has a capitalist economy with the public accounting for around 40 percent of the gross domestic product, or GDP. The majority of Greece's economy centers around the service sector, which includes such areas as gambling, banking and health care. A sizable portion of the country's economy comes from the tourism industry, which produces around 18 percent of the GDP.Full Answer >
Crime affects the economy by placing a financial burden on taxpayers and governments because of increased needs for police, courts and corrections facilities, as well as intangible costs including psychological trauma and reduced quality of life for crime victims, according to Scott Erickson. In an article for The Daily Caller, Erickson cites a 1999 study conducted by economist David Anderson that estimated the cost of crime at $1.7 billion annually.Full Answer >
Inflation is an increase in prices, which affects the economy by reducing the purchase power of consumers, causing companies to earn less revenue. Inflation also increases the rate of unemployment.Full Answer >
Technology has affected the economy through direct job creation, contribution to GDP growth, creation of new services and industries, workforce transformation and business innovation. The use of technology has been linked to marketplace transformation, improved living standards and more robust international trade. Technology has revolutionized virtually every industry in the economy.Full Answer >