Flexibility of adjustment to shocks : economic growth and volatility of middle-income countries before and after the Global Financial Crisis of 2008
Joshua Aizenman, Yothin Jinjarak, Gemma Estrada, and Shu Tian
The pronounced and persistent impact of the global financial crisis of 2008 motivates our empirical analysis of the role of institutions and macroeconomic fundamentals on countries' adjustment to shocks. Our empirical analysis shows that the associations of growth level, growth volatility, shocks, institutions, and macroeconomic fundamentals have changed in important ways after the crisis. Gross domestic product growth across countries has become more dependent on external factors, including global growth, global oil prices, and global financial volatility. After accounting for the effects global shocks, we find that several factors facilitate adjustment to shocks in middle-income countries. Educational attainment, share of manufacturing output in gross domestic product, and exchange rate stability increase the level of economic growth, while exchange rate flexibility, education attainment, and lack of political polarization reduce the volatility of economic growth. Countries cope with shocks better in the short to medium term by using appropriate policy tools and having good long-term fundamentals.
Year of publication: |
[2017]
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Authors: | Aizenman, Joshua ; Jinjarak, Yothin ; Estrada, Gemma ; Tian, Shu |
Publisher: |
Metro Manila, Philippines : Asian Development Bank |
Subject: | growth | institutions | middle income | shocks | volatility | Wirtschaftswachstum | Economic growth | Konjunktur | Business cycle | Wirtschaftliche Anpassung | Economic adjustment | Institutionelle Infrastruktur | Institutional infrastructure | Schwellenländer | Emerging economies | Finanzkrise | Financial crisis | Schock | Shock | Konjunkturzusammenhang | Business cycle synchronization | Welt | World | 2000-2015 |
Saved in:
freely available
Extent: | 1 Online-Ressource (circa 31 Seiten) Illustrationen |
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Series: | ADB economics working paper series. - Manila : [Verlag nicht ermittelbar], ISSN 2313-6545, ZDB-ID 2508948-1. - Vol. no. 526 (November 2017) |
Type of publication: | Book / Working Paper |
Type of publication (narrower categories): | Arbeitspapier ; Working Paper ; Graue Literatur ; Non-commercial literature |
Language: | English |
Other identifiers: | 10.22617/WPS179127-2 [DOI] http://dx.doi.org/10.22617/WPS179127-2 [DOI] hdl:10419/203366 [Handle] |
Classification: | c38 ; E02 - Institutions and the Macroeconomy ; F43 - Economic Growth of Open Economies |
Source: | ECONIS - Online Catalogue of the ZBW |
Persistent link: https://www.econbiz.de/10011754881