Was the term "depression" (in the economic sense) originally coined to describe and downplay current events in the 1930s?

Question

Several years ago, I heard someone claim that the distinction between "recession" and "depression" is less than 100 years old. Apparently all economic downturns used to be called a "recession." But when things began to head south in the 1930s, economists tried to assuage concerns by telling people that we're not really in a recession; it's just a mild depression and nothing to get alarmed over.

This, of course, backfired spectacularly as the "mild depression" turned into one of the greatest economic collapses in modern history, and nowadays the term refers, not to something that's kinda like a recession but milder, but something that's kinda like a recession but worse.

It's a very interesting story, but is it true? I tried to verify it but between articles on (medical) depression and articles on the events surrounding the Great Depression, the history of the term itself is annoyingly hard to Google!

Answer 1

The Oxford English Dictionary has citations for the modern sense of "recession" ("A period of economic decline during which trade and industrial activity are reduced") from 1905, and from the 1840s in the more general sense of "a recession in prices".

By comparison, the modern sense of "depression" is cited as early as the 1820s ("that depression in manufactures and commerce"), with the more general "a depression in the public funds" as early as 1793. One of their citations is to an official document - by the 1880s, the UK government was appointing Royal Commissions to look into "the Depression of Trade and Industry", suggesting the term was very firmly established by then.

So it certainly seems that of the two, "depression" is the older.