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The Great Recession and Small States

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  • J A Edwards
  • C B Naanwaab
  • S P Simkins

Abstract

This paper raises a simple question: relative to the rest of the world, how was small state real per capita GDP growth impacted by the Great Recession of 2008-2009? While holding constant average business cycle dynamics, we isolate this shock to measure how small countries around the globe responded to the recession - something that has not been studied before. The results indicate that while small states had a more pronounced contraction than the rest of the world going into the Great Recession, their rebound was both stronger and quicker, allowing them to return to their long-run growth rates more rapidly than other countries. Additionally, the methods and data configurations used in this study will provide guidance to researchers analysing future global exogenous shocks.

Suggested Citation

  • J A Edwards & C B Naanwaab & S P Simkins, 2023. "The Great Recession and Small States," Economic Issues Journal Articles, Economic Issues, vol. 28(1), pages 81-103, March.
    • Handle: RePEc:eis:articl:123edwards
    as

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    File URL: http://www.economicissues.org.uk/Files/2023/EI_March2023_edwards.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Great Recession; small states; exogenous shock; growth;
    All these keywords.

    JEL classification:

    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission

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