Turning points of the global business cycle are identified by means of two methods widely used in the analysis of national business cycles: a statistical method and a judgmental method. The former defines a global recession as taking place when there is a decline in annual global real GDP per capita. The judgmental method, similar to the method used for the United States by the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER), considers whether there is strong evidence for a broad-based decline in multiple key indicators of global economic activity in a given year. This paper focuses on six main global activity indicators: real GDP per capita, industrial production, trade, capital flows, oil consumption, and employment. These two methods together provide an intuitively appealing characterization of the turning points of the global business cycle and translate into a concrete definition of a global recession.

For the purposes of this study, and following KT, a global recession is defined as a contraction in global real GDP per capita accompanied by a broad decline in various other measures of global activity. The definition of a global recovery also closely follows the standard definition used in the context of national business cycles. The recovery phase is the period after the trough and defined here as the one- or three-year period following the trough of the cycle. The recovery is thus the earlier part of the expansion phase, which refers to the whole period between two recessions.

Main findings of this paper are as follows.

Global recessions. In the seventy years since 1950, the world economy has experienced four global recessions: in 1975, 1982, 1991, and 2009. In each of these episodes, there was a contraction in annual real per capita global GDP and broad-based weakness in other key indicators of global economic activity. These episodes were highly synchronized internationally, involving severe economic and financial disruptions in many countries around the world. The 2009 global recession was by far the deepest and most synchronized episode among the four.

Global recoveries. A global recovery usually involves a broad-based rebound in macroeconomic and financial activity. Among the four episodes, the strongest recovery occurred after the 1975 recession. Thanks to large, prompt, and globally coordinated policy support, the recovery following the 2009 recession was the second strongest episode.

Impact across country groups and regions. The impact of global recessions varied across different groups of countries. Average per capita growth declined more in advanced economies than EMDEs during global recessions. LICs on average suffered larger declines in per capita growth than the average EMDE. The East Asia and Pacific (EAP) and South Asia (SAR) regions even continued expanding during global recessions. However, the other four EMDE regions, particularly those with more reliance on exports of industrial commodities, experienced per capita output declines.

Relatively good performance of EMDEs through the latest global recession. As the epicenter of the financial crisis, advanced economies felt the brunt of the 2009 global recession. In contrast, EMDE output growth remained positive during the recession, and EMDEs delivered a stronger recovery post-2009 than after any of the three previous 3