posted on 06-06-2019

Negative Growth

Updated October 1, 2019

What is Negative Growth?

In economics, negative growth usually refers to shrinking gross domestic product (GDP).

How Does Negative Growth Work?

For example, if the United States' GDP falls from $14.4 trillion to $14.1 trillion, we would say that the U.S. economy exhibited negative growth.

Why Does Negative Growth Matter?

Negative growth is the prelude and measurement of recessions or depressions. In particular, the traditional definition of a recession is negative growth in GDP for two or more consecutive quarters.


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Related Definitions

Economics
Economics is the academic study of the production, distribution, and consumption of goods and services. See More
Gross Domestic Product (GDP)
Gross Domestic Product (GDP) is a quantitative measure of how much an economy produces. It includes the monetary value of both goods and services within a... See More
Gross Domestic Product (GDP)
Gross Domestic Product (GDP) is a quantitative measure of how much an economy produces. It includes the monetary value of both goods and services within a... See More
Economy
In its broadest sense, the economy is the organized system of human activity involved in the production, consumption, exchange, and distribution of goods... See More
Recession
A recession is two consecutive quarters of declining gross domestic product (GDP) See More
Gross Domestic Product (GDP)
Gross Domestic Product (GDP) is a quantitative measure of how much an economy produces. It includes the monetary value of both goods and services within a... See More
Fiscal Quarter (Q1, Q2, Q3, Q4)
A fiscal quarter is a consecutive three-month period within a company’s fiscal year. These calendar divisions are used by publicly-traded companies to schedule... See More

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