Market-based economies tend to exhibit cyclical behaviour. The recent financial crisis, with devastating impacts that are still being felt today, has added urgency to the drive to improve our understanding of business cycles. Pinpointing key turning points in the economy, meaning when recession takes hold or growth resumes, is vital for policymakers, businesses and consumers alike.
In this Commentary, the authors clarify how best to define a recession and measure its severity. And, to create a foundation for further research in this area, this Commentary provides an authoritative set of business cycle dates for Canada, going back to 1926.These dates were reviewed and approved by the C.D. Howe Institute Business Cycle Council.