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Worldwide economic recoveries from financial crises through the decades

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  • Barthélémy, Sylvain
  • Binet, Marie-Estelle
  • Pentecôte, Jean-Sébastien

Abstract

The profiles of economic recoveries after a financial crisis are identified through a self-organizing map, covering 104 countries during 1973–2017. First and surprisingly, only 55% of the 276 events belong to the usual V-U-L classification. New S-shaped bounce-back recoveries, D(oomed) ones, and double-dip M occur in 23%, 18%, and 4% of the cases, respectively. Second, the frequencies of profiles vary with the crisis type, countries’ development and location, and over time. Third, unlike government spending, supporting domestic credit, liquidity, foreign trade or else the exchange rate after the crisis may help activity bounce back.

Suggested Citation

  • Barthélémy, Sylvain & Binet, Marie-Estelle & Pentecôte, Jean-Sébastien, 2020. "Worldwide economic recoveries from financial crises through the decades," Journal of International Money and Finance, Elsevier, vol. 105(C).
  • Handle: RePEc:eee:jimfin:v:105:y:2020:i:c:s0261560620301601
    DOI: 10.1016/j.jimonfin.2020.102204
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    Keywords

    Economic Recovery; Early Warning Signals; Financial Crises; Output Gap; Self-Organizing Map; Multinomial Logit Model;

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • G01 - Financial Economics - - General - - - Financial Crises

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