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Economic Resilience and Vulnerability: Concepts and Indices

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  • Mirjalili, Seyed hossein

Abstract

This paper examines the concepts and indices of economic resilience and vulnerability. The central notion in clarifying both resilience and vulnerability is that of an adverse shock. If a shock does not alter the growth path of an economy or cause a recession, the economy is considered “resilient.” Resilience refers to an economy’s ability to return to its pre-shock growth trajectory. A resilient economy, after experiencing a shock, resumes its long-term growth path. Endogenous growth can strengthen economic resilience, and resilient economies tend to experience sustainable growth. Macroeconomic stability and effective institutions are two principal indicators of economic resilience. Resilience stems largely from economic policymaking, while vulnerability is related to the inherent structural characteristics of an economy that expose it to adverse shocks. Export concentration, dependence on strategic imports and external financing, as well as geographical vulnerability, constitute the main indicators of economic vulnerability. The greater the capacity to respond to shocks, the lower the vulnerability. The paper explores the indices of economic resilience, including Briguglio, Centennial group and Oxford FM Global. In vulnerability indices, the paper discusses the Briguglio vulnerability index, Guillamount and OECD indices.

Suggested Citation

  • Mirjalili, Seyed hossein, 2025. "Economic Resilience and Vulnerability: Concepts and Indices," MPRA Paper 126492, University Library of Munich, Germany, revised 11 Jul 2025.
    • Handle: RePEc:pra:mprapa:126492
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    References listed on IDEAS

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    1. Patrick Guillaumont, 2010. "Assessing the Economic Vulnerability of Small Island Developing States and Least Developed Countries," Post-Print hal-00594797, HAL.
    2. Valerie Cerra & Sweta Chaman Saxena, 2008. "Growth Dynamics: The Myth of Economic Recovery," American Economic Review, American Economic Association, vol. 98(1), pages 439-457, March.
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    4. Heydarian, Samira & Pahlavani, Mosayeb & Mirjalili, Seyed Hossein, 2022. "The Impact of Financial Sanctions on Capital Inflow and Outflow (case of Iran)," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 17(1), pages 67-88.
    5. Mirjalili, Seyed Hossein & Pahlavani, Mosayb & Heydarian, Samira, 2025. "Financial Sanction, Exchange Rate Volatility and Macroeconomic Variables (Case of Iran)," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 9(2), pages 70-106.
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    7. Safari, Omid & Assadzadeh, Ahmad & Mirjalili, Seyed Hossein, 2024. "Fiscal Policy Uncertainty and Industrial Investment in Iran," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 16(1), pages 229-259.
    8. Heydarian, Samira & Pahlavani, Mosayeb & Mirjalili, Seyed Hossein, 2024. "Financial Sanctions, Oil Revenues and Monetary and Fiscal policies in Iran: DSGE Model," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 16(2), pages 145-183.
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    Keywords

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    JEL classification:

    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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