The Cross-Country Incidence of the Global Crisis

40 Pages Posted: 14 Feb 2011

See all articles by Gian Maria Milesi-Ferretti

Gian Maria Milesi-Ferretti

National Bureau of Economic Research (NBER); Senior Fellow; Centre for Economic Policy Research (CEPR)

Philip R. Lane

Trinity College (Dublin) - Department of Economics; Centre for Economic Policy Research (CEPR); Central Bank of Ireland

Multiple version iconThere are 2 versions of this paper

Date Written: July 2010

Abstract

We examine whether the cross-country incidence and severity of the 2008-2009 global recession is systematically related to pre-crisis macroeconomic and financial factors. We find that the pre-crisis level of development, increases in the ratio of private credit to GDP, current account deficits, and openness to trade are helpful in understanding the intensity of the crisis. International risk sharing did little to shield domestic demand from the country-specific component of output declines, while those countries with large pre-crisis current account deficits saw domestic demand fall by much more than domestic output during the crisis.

Suggested Citation

Milesi-Ferretti, Gian Maria and Milesi-Ferretti, Gian Maria and Lane, Philip R., The Cross-Country Incidence of the Global Crisis (July 2010). IMF Working Paper No. 10/171, Available at SSRN: https://ssrn.com/abstract=1760360

Gian Maria Milesi-Ferretti (Contact Author)

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Philip R. Lane

Trinity College (Dublin) - Department of Economics ( email )

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