We often hear that the we just went through the greatest recession since the Great Depression.
However, the Great Depression wasn’t just a little bit worse.
Later today at the American Economic Association conference, Harvard professors Carmen Reinhart and Kenneth Rogoff will be presenting their paper “Recovery from Financial Crises: Evidence from 100 Episodes.”
Their paper includes this chart showing how much real GDP per capita dropped during various crisis periods. As you can see, the contraction of the recent credit crisis isn’t even close to as bad as the collapse during the Great Depression.