IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Shocks, Crises, And Their Determinants

  • Justin Yifu Lin

    ()

    (World Bank)

The current global financial crisis is the most serious both in terms of magnitude and scope since the Great Depression. No country has been immune to the economic slowdown. In advanced economies, the financial crisis and the global recession that followed the burst of the global financial bubble have brought severe consequences in terms of employment and output. In developing countries, output contraction, growth slowdown, and rising unemployment came hand in hand with higher borrowing costs, sluggish export growth, and a significant reduction in international capital flows. As a result, poverty has increased. The global financial crisis has left lasting effects on the structure of financial markets, international capital flows, and the cost of capital for developing countries. The efforts of governments and international financial institutions to buffer the impact of the crisis have been quick and aimed in the right direction. However, many risks remain for the road to recovery. This paper provides a brief explanation of how the current global financial crisis originated, and the underlying factors that turned a relatively small collapse in the U.S. subprime mortgage market into a global crisis. Next it explores similarities and differences between the current crisis and past experiences. This comparison can provide us with a better understanding of the main determinants and transmission mechanisms involved, which can help us design a better response to the current situation on the one hand, and prevent future crises or minimize their impact on the other. Finally, lessons that can be learned for developing countries are discussed, focusing on policies governments can implement to mitigate the effects of crises and factors that are important for reducing the risks of experiencing a crisis.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.erf.org.eg/CMS/getFile.php?id=1627
Download Restriction: no

File URL: http://www.erf.org.eg/cms.php?id=NEW_publication_details_working_papers&publication_id=1223
Download Restriction: no

Paper provided by Economic Research Forum in its series Working Papers with number 516.

as
in new window

Length: 21 pages
Date of creation: Apr 2010
Date of revision: Apr 2010
Publication status: Published by The Economic Research Forum (ERF)
Handle: RePEc:erg:wpaper:516
Contact details of provider: Postal: 7 Boulos Hanna Street, Dokki, Cairo
Phone: 202-3370810
Fax: 202-3616042
Web page: http://www.erf.org.eg
Email:


More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:erg:wpaper:516. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Namees Nabeel)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.