An economic expansion is an increase in the level of
economic activity
Economics () is the social science that studies the production, distribution, and consumption of goods and services.
Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analyzes w ...
, and of the goods and services available. It is a period of
economic growth as measured by a rise in
real GDP
Real gross domestic product (real GDP) is a macroeconomic measure of the value of economic output adjusted for price changes (i.e. inflation or deflation). This adjustment transforms the money-value measure, nominal GDP, into an index for quantit ...
.
The explanation of fluctuations in aggregate economic activity between economic expansions and
contractions is one of the primary concerns of
macroeconomics.
Typically an economic expansion is marked by an upturn in production and utilization of resources.
Economic recovery
An economic recovery is the phase of the business cycle following a recession. The overall business outlook for an industry looks optimistic during the economic recovery phase.
During the recovery period, the economy goes through a process of e ...
and prosperity are two successive phases of expansion, where as a recession is defined as two declining periods of GDP. Expansion may be caused by factors external to the economy, such as weather conditions or technical change, or by factors internal to the economy, such as
fiscal policies,
monetary policies, the availability of
credit
Credit (from Latin verb ''credit'', meaning "one believes") is the trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately (thereby generating a debt) ...
,
interest rate
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, ...
s,
regulatory policies or other impacts on producer incentives. Global conditions may influence the levels of economic activity in various countries.
Economic
contraction and expansion relate to the overall output of all goods and services, while the terms inflation and deflation refer to increasing and decreasing prices of commodities, goods and services in relation to the value of money.
Expansion means enlarging the scale of a company. The ways of expansion include internal expansion and integration.
Internal expansion means a company enlarges its scale through opening branches, inventing new products, or developing new businesses. Integration means a company enlarges its scale through taking over or merging with other companies.
References
External links
"Business Cycle Expansions and Contractions", National Bureau of Economic Research
{{Authority control
Business cycle
Expansion
Market trends