Economic Cycle Volatility in the World Economy and Prospects for Global Economic Equilibrium Recovery

Abstract

The article examines the problems of cyclical economic development in the world economy. The trends in economic development and the degree of economic cycle volatility in the world during the 1970-2010 are analyzed. The phenomenon of the Great Moderation as a period of achieving the long-term relative equilibrium in the global economy on methodological and empirical level is represented. On the basis of correlation and regression modeling the trends of real GDP and changes in consumer prices for economies are identified, on which nowadays predominantly the restoration of economic equilibrium depends in view of maintaining the existing global economic order. Scenarios of restoring the global economic equilibrium within the neoclassical and neokeynesian vision are outlined and alternative modern concepts of global economy transformation in the context of attempts to solve the problem of worsening cyclical economic development and economic instability are presented.