Analyse the reasons for the recent UK recession and its impact on one Essay

Analyse the reasons for the recent UK recession and its impact on one particular leisure market. E.g. travel, restaurants, tourism - Essay Example Choice as a factor of growth is crucial in the growth of an economy since the economy needs consumers will and choice of products in order to relish and grow. That said, it is evident that the economy requires the input of consumers and produces who act as the driving force since they provide the necessary resources which include labour, land, physical and human capital etc. This paper will discuss the main reasons why the recent UK recession occurred and its impact in the tourism industry as a leisure market. The paper will aim at answering the why and the how questions in relation to the causes and the impacts of the 2008 – 2009 UK recession that occurred between the last quarter of 2008 and the second quarter of 2009. The paper addresses the reasons of the recession in the first section and the impacts of the recession on the tourism industry in the second section and finally a conclusion, which aim at giving a clear discussion and analysis of the first two sections. Verick and Islam (2010) argue that the 2008 – 2009 global recession (financial crisis) was largely accelerated by the global imbalances that were being experienced worldwide at that time in terms of a drop in interest rates, perceptions of risks, and the regulation of financial systems. The UK was, apparently, not left behind as it faced many financial problems including near bankruptcy of banks, a fall in its stock market, large levels of public debt, a tumbling currency and frozen money markets which were all factors that promoted a recession (Cooper, 2009). Among the leading causes of the recession was the devaluation of UK currency the Sterling Pound. The Sterling Pound during the recession had a devaluated by 25-30% from the value it once held in before the recession. This was in accordance with the basic economic theory that states that any decrease in the exchange rates of a currency will eminently aid in the