Abstract

http://ssrn.com/abstract=1945221
 


 



Assessing the Impact of the Global Financial and Economic Crisis in Developing Countries: The Case of Uruguay


Carmen Estrades


International Food Policy Research Institute (IFPRI)

Cecilia Llambi


Centro de Investigaciones Economicas (CINVE - Uruguay)

October 17, 2011

MPIA Working Paper No. 2011-16

Abstract:     
This paper uses a static computable general equilibrium model (CGE) linked to a microsimulation model to analyze how the global crisis and some adopted policy responses may have affected the Uruguayan economy. The focus is on the trade channel and foreign capital flows, since they are the most important mechanisms through which the global crisis affected the Uruguayan economy. The crisis had a strong impact on exports and fixed investment. Poorest households would be the most affected, as they face a stronger reduction in real wages and a rise in unemployment. We find a negative impact on extreme poverty, but not on moderate poverty, as households near the poverty line would benefit from the fall in some consumer prices. A policy based in increasing current public consumption does moderately counteract some negative impacts of the crisis, but benefits mainly skilled workers, and does not act directly towards the most affected.

Number of Pages in PDF File: 35

Keywords: Global economic crisis, Trade shock, Fiscal response, Uruguay, Unemployment

JEL Classification: D58, I32, G01, J68, H50

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Date posted: October 28, 2011  

Suggested Citation

Estrades, Carmen and Llambi, Cecilia, Assessing the Impact of the Global Financial and Economic Crisis in Developing Countries: The Case of Uruguay (October 17, 2011). MPIA Working Paper No. 2011-16. Available at SSRN: http://ssrn.com/abstract=1945221 or http://dx.doi.org/10.2139/ssrn.1945221

Contact Information

Carmen Estrades
International Food Policy Research Institute (IFPRI) ( email )
2033 K Street, NW
Washington, DC 20006
United States
Cecilia Llambi (Contact Author)
Centro de Investigaciones Economicas (CINVE - Uruguay) ( email )
Uruguay 1242
Montevideo, 11100
United States
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