Sustaining a Global Recovery

Finance & Development, Vol. 46, No. 3, p. 8-12, September 2009

5 Pages Posted: 4 Sep 2009

See all articles by Olivier J. Blanchard

Olivier J. Blanchard

National Bureau of Economic Research (NBER); Peter G. Peterson Institute for International Economics

Date Written: August 31, 2009

Abstract

Recovery from the global economic crisis has begun, but the crisis has most likely caused a drop in potential output. The higher-than-normal growth that follows most recessions should not be expected this time. Sustaining the recovery will require two delicate rebalancing acts. First, countries will have to rebalance from public to private spending. Second, aggregate demand will have to be rebalanced across counties, with a shift from domestic to foreign demand in the United States and a reverse shift from foreign to domestic demand in the rest of the world, especially Asia.

Suggested Citation

Blanchard, Olivier J., Sustaining a Global Recovery (August 31, 2009). Finance & Development, Vol. 46, No. 3, p. 8-12, September 2009. Available at SSRN: https://ssrn.com/abstract=1465026

Olivier J. Blanchard (Contact Author)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Peter G. Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

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