The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Trade Cycle

  • A. Medio
Reference work entry


The dynamics of capitalist economies are characterized by two facts: sustained growth of production and employment and wide oscillations of these magnitudes and the level of prices as well. This oscillatory behaviour of economic activity as a whole is indeed the subject of trade cycle theory. The use of the word ‘cycle’, besides pointing to alternation of ups and downs, also suggests the idea that oscillations are somewhat regular.


Business cycle Capital intensity Chaos Classical theory of the cycle Entrepreneurship Equilibrium Equilibrium business cycle theory Forced saving Hawtrey, R. G. Hayek, F. A. von Hobson, J. A. Innovation Inventory investment Juglar cycles Kitchin cycles Kitchin, J. Kondratieff cycles Long run and short run Marginal efficiency of capital Monetary theory of the cycle Multiple equilibria Multiplier–accelerator theory Overinvestment theory of the cycle Population growth Stability of equilibrium Technical change Trade cycle Underconsumption theory of the cycle Uniqueness of equilibrium Voluntary saving Walras’s Law White noise 

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  • A. Medio
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