The term procyclicality is not part of the dictionary of the Royal Spanish Academy (RAE). Either procyclicality, another word that is usually used in our language in the field of economy and the finance. Both concepts come from English procyclicality.

ProcyclicalityAs published in semicolon, the bulletin developed by the Spanish translators of the entities of the European Union (EU) and other translation professionals, it is preferable to resort to the notion of procyclicality. Anyway, all you have to do is search Google to discover that many media outlets choose to use procyclicality.

Procyclicality and procyclicality, in short, refer to what happens when the credit flows and capitals I know multiply in a favorable context and later disappear if the situation changes. This phenomenon causes spirals that are optimistic or pessimistic in an excessive way, generating exaggerated consequences.

It is important to note that cycles they are normal economically. Procyclicality appears when the oscillations are very large due to the magnitude of the peaks in the boom and the depressions in the opposite moment.

Specialists indicate that procyclicality occurs when it goes from waste to excessive austerity and vice versa. This trend tends to occur in those sectors of the economy in which the volatility of the prices it is usual.

The logic of procyclicality or procyclicality is easy to understand by analyzing the fiscal policy from many countries. It is usual that, in periods of economic boom, governments greatly increase public spending. Then, in times of recession and crisis, that same spending is reduced as much as possible. For experts, this causes the growth stages to be very marked, as well as the periods of economic contraction.