Economics Online Tutor
| List of Recessions in United States History |
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Source: Wikipedia "List of recessions in the United States"
Notes:
This page is a supplement to the page "U.S. Economic History"
Modern macroeconomic statistics have been compiled on a regular and standardized basis only since
World War II. The percentage decline column starting with the Great Depression (1929-1934) represents
GDP decline from the previous peak as compiled by the Bureau of Economic Analysis. Unemployment
numbers in the United States have been compiled by the Bureau of Labor Statistics since 1948.
No information on recessions was compiled prior to 1857. The recessions listed in the table for dates
prior to 1857 have been extrapolated by economists using available source documents such as local
newspapers. The Cleveland Trust Company began publishing the percentage drop in business activity
for the years following 1834 based on published reports. The National Bureau of Economic Research
began dating the recessions starting in 1857. The actual dates of recessions prior to 1857 are only rough
estimates.
Prior to the Great Depression, the information is only extrapolated and cannot be considered to be
accurate. It would be unreliable to compare these earlier recessions with later ones that are based on
standardized published statistics. However, it is clear from the known information that these earlier
recessions were felt much deeper throughout the economy than the ones between 1934 and 2007.
The average duration of recessions is known to be shorter in the modern period: from 1854 to 1919 it was
22 months; from 1919 to 1945, 18 months; and from 1945 to 2009, 11 months. The average period of
economic growth between recessions for the same time frames has also grown: 1854 to 1919 it was 26
months; 1919 to 1945, 35 months; and 1945 to 2009, 58 months. Basically, recessions now are half as long
and twice as far apart since World War II.
It is known that many recessions prior to World War II are related to financial panics with associated bank
runs.
Some important events in United States economic history to keep in mind when studying this information:
1791 - 1811: The First Bank of the United States
1816 - 1836: The Second Bank of the United States
These two banks were the forerunners of a central bank in the United States, although their influence
was not as large as the modern Federal Reserve
1837 - 1862: The United States had no central bank and no national banking charters. State and local
governments regulated banks.
1863: The National Banking Act created national bank charters, but the United States still did not have a
central bank.
1913: The 16th Amendment to the United States Constitution created the modern income tax.
1913: The Federal Reserve Act created the Federal Reserve System.
1930s: The United States began to use discretionary fiscal and monetary policies to influence the
business cycle in response to the Great Depression. These policies were somewhat codified into law
with the Employment Act of 1946.
1933: The effective date, but not the official date, that the United States left the gold standard. Trading in
gold as a precious metal was banned in order to prevent hoarding during recessionary times.
1970: The official date that the United States left the gold standard and switched to all fiduciary, or fiat,
money.
Notes:
This page is a supplement to the page "U.S. Economic History"
Modern macroeconomic statistics have been compiled on a regular and standardized basis only since
World War II. The percentage decline column starting with the Great Depression (1929-1934) represents
GDP decline from the previous peak as compiled by the Bureau of Economic Analysis. Unemployment
numbers in the United States have been compiled by the Bureau of Labor Statistics since 1948.
No information on recessions was compiled prior to 1857. The recessions listed in the table for dates
prior to 1857 have been extrapolated by economists using available source documents such as local
newspapers. The Cleveland Trust Company began publishing the percentage drop in business activity
for the years following 1834 based on published reports. The National Bureau of Economic Research
began dating the recessions starting in 1857. The actual dates of recessions prior to 1857 are only rough
estimates.
Prior to the Great Depression, the information is only extrapolated and cannot be considered to be
accurate. It would be unreliable to compare these earlier recessions with later ones that are based on
standardized published statistics. However, it is clear from the known information that these earlier
recessions were felt much deeper throughout the economy than the ones between 1934 and 2007.
The average duration of recessions is known to be shorter in the modern period: from 1854 to 1919 it was
22 months; from 1919 to 1945, 18 months; and from 1945 to 2009, 11 months. The average period of
economic growth between recessions for the same time frames has also grown: 1854 to 1919 it was 26
months; 1919 to 1945, 35 months; and 1945 to 2009, 58 months. Basically, recessions now are half as long
and twice as far apart since World War II.
It is known that many recessions prior to World War II are related to financial panics with associated bank
runs.
Some important events in United States economic history to keep in mind when studying this information:
1791 - 1811: The First Bank of the United States
1816 - 1836: The Second Bank of the United States
These two banks were the forerunners of a central bank in the United States, although their influence
was not as large as the modern Federal Reserve
1837 - 1862: The United States had no central bank and no national banking charters. State and local
governments regulated banks.
1863: The National Banking Act created national bank charters, but the United States still did not have a
central bank.
1913: The 16th Amendment to the United States Constitution created the modern income tax.
1913: The Federal Reserve Act created the Federal Reserve System.
1930s: The United States began to use discretionary fiscal and monetary policies to influence the
business cycle in response to the Great Depression. These policies were somewhat codified into law
with the Employment Act of 1946.
1933: The effective date, but not the official date, that the United States left the gold standard. Trading in
gold as a precious metal was banned in order to prevent hoarding during recessionary times.
1970: The official date that the United States left the gold standard and switched to all fiduciary, or fiat,
money.
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