The Evaluation of Recession Magnitudes in EU Countries during the Great Recession 2008–2010

The aim of this article is to compare 2008-2010 recession magnitudes in individual EU countries. For the comparison the recession magnitude scale was used. The strongest recession during the examined period took place in Latvia, Estonia, Lithuania, Greece and Ireland, while the weakest recessions in the EU occurred in France, Malta and Cyprus. Poland and Slovakia were the only two EU countries that didn’t fall into a recession, that’s why they were not included in the study. The main findings of the paper are that EU19’s recession was much smaller than both the Great Depression of the 1930s and the recent Great Recession in the USA. Furthermore, with the use of a linear econometric model it was found that recession magnitudes in EU countries were directly proportional to the countries’ GDP per capita in 2008 and growth prior to recessions, while countries’ economic openness was indirectly proportional to recession magnitudes, all the relationships being statistically significant.