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Peculiarities Of Economics Recovery After Worldwide Economic Crisis In 2008–2009

Author

Listed:
  • Aldona Juozapaviciene

    (Kaunas University of Technology, Lithuania)

  • Agne Montvidaite

    (Kaunas University of Technology, Lithuania)

Abstract

Variation analysis of several main procyclic indicators (leading and coincident) was carried out in this article. The results of the analysis showed that the economies of Lithuania and the European Union are slowly recovering. The attempts of European countries to struggle against deep recession caused by the world economic crisis have led to a new - sovereign debt crisis. It manifested in increasing differences between government bond yields and premiums of Credit Default Swap (CDS) between PIIGS countries and other EU members, notably Germany. Accordingly to this, CDS was examined as the leading indicator of the economic cycle. During the period of the economic crisis, the government of Lithuania borrowed in international markets very expensively and the accumulated debt can become a heavy burden on the country's future economy. The situation of public finance in Lithuania was analyzed by adopting the mathematical model of Zamkov. The performed simulation showed that the debt of Lithuanian public sector will press the country for a long period of time.

Suggested Citation

  • Aldona Juozapaviciene & Agne Montvidaite, 2012. "Peculiarities Of Economics Recovery After Worldwide Economic Crisis In 2008–2009," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 7(2), pages 35-55, June.
    • Handle: RePEc:pes:ierequ:v:7:y:2012:i:2:p:35-55
    DOI: 10.12775/EQUIL.2012.010
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    References listed on IDEAS

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    1. World Bank, 2009. "Reform of China's Rural Credit Unions : Policy Note," World Bank Publications - Reports 12719, The World Bank Group.
    2. Junnosuke Shino & Kouji Takahashi, 2010. "Sovereign Credit Default Swaps: Market Developments and Factors behind Price Changes," Bank of Japan Review Series 10-E-2, Bank of Japan.
    3. anonymous, 2009. "Reforms to protect American credit card holders," Community Investments, Federal Reserve Bank of San Francisco, vol. 21(Sum), pages 35-36.
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    More about this item

    Keywords

    economic cycle indicators; Credit Default Swap (CDS); sovereign debt crisis; public finance in Lithuania;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises

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