Journal Article
What caused the 1990-1991 recession?
Abstract: This article decomposes U.S. GDP into components associated with major macroeconomic disturbances in order to identify the likely causes of the 1990 recession. Four types of disturbances--aggregate supply, aggregate spending, money demand and money supply--are identified in the empirical analysis. The results suggest the general slowing of the economy relative to trend prior to the actual downturn was due to restrictive monetary policy. Aggregate spending factors turned contractionary in mid-1990, however, and accounted for most of the subsequent decline in GDP during the rest of 1990.
Keywords: Recessions; Monetary policy - United States; economic conditions - United States;
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Bibliographic Information
Provider: Federal Reserve Bank of San Francisco
Part of Series: Economic Review
Publication Date: 1993
Pages: 33-48
Order Number: 2