The business cycle in the contemporary capitalist economy

This paper provides an introduction to the business cycle. In the capitalist economy there are fluctuations in economic activity which apply to all aspects of socio-economic development. Capitalist economy is growing at a variable rate. These regular changes in economic activity are called cyclical or economic fluctuations. Business cycles as we know them today were first identified and analyzed by Arthur Burns and Wesley Mitchell in their 1946 book, Measuring Business Cycles (Romer, 2008): 'Business cycles are a type of fluctuation found in the aggregate economic activity of nations that organize their work mainly in business enterprises: a cycle consists of expansions occurring at about the same time in many economic activities, followed by similarly general recessions, contractions, and revivals which merge into the expansion phase of the next cycle'(Burns, Mitchell, 1946, s. 5).