European Booms and Busts over Six Centuries

Don Bredin (), Stilianos Fountas and Georgios Karras ()
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Don Bredin: University College Dublin
Georgios Karras: University of Illinois at Chicago

Discussion Paper Series from Department of Economics, University of Macedonia

Abstract: We examine the impact of economic upturns and downturns on subsequent economic performance in Europe over six plus centuries. Instead of utilizing the conventional post-World War II framework, we employ a comprehensive panel of GDP data for England, Holland and Italy spanning more than 600 years. We find consistent evidence in favor of asymmetry. Downturns are followed by statistically significant higher growth rates, while upturns are followed by mildly lower growth rates which are often not statistically significant. Our finding of asymmetry suggests that business cycle properties are consistent with mechanisms similar to Friedman’s plucking hypothesis

Keywords: scarring; cleansing; economicdownturnsandupturns; economic growth (search for similar items in EconPapers)
JEL-codes: C22 E32 E60 N10 (search for similar items in EconPapers)
Date: 2026-04, Revised 2026-04
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