Title Global shocks and their impact on low-income countries : lessons from the global financial crisis / Andrew Berg [and others]

Published [Washington, D.C.] : International Monetary Fund, ©2011

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Description 1 online resource (52 pages) : color illustrations Series IMF working paper, 2227-8885 ; WP/11/27 IMF working paper ; WP/11/27. Contents Cover Page; Title Page; Copyright Page; Contents; I. Introduction; II. Key Stylized Facts; 1. Change in Output Growth Rate; 2. Output Growth Rate; 3. Relative Severity of 2009 Output Decline; 4. Synchronization of Business Cycles: Average Bilateral Correlations of Real GDP per Capita Growth, 1965-2009; 5. Change in the Growth Rate of External Demand; 6. Change in the Growth Rate of the External Terms of Trade; 7. Change in FDI/GDP; III. Cross-Country Analysis; 8. External Demand and Per-Capita GDP Growth in Non-Fuel-Exporting LICs and MICs, 2007-09; 1. Cross-Country Regression Analysis 2. Cross-Country Quartiles Analysis for Non-Fuel-Exporting LICsIV. Panel Analysis; A. The Role of Non-Policy Variables; 3. Regression Analysis (Panel GMM) Initial Specification for Output Growth, All Years; 4. Regression Analysis (Panel GMM): Baseline Specification for Output Growth, Years 1990-2009; 5. Regression Analysis: Alternative Specification for Output Growth with Asymmetries, All Years; 6. Regression Analysis (Panel GMM): Alternative Specification 2 for Output Growth with Asymmetries, All Years; 7. Regression Analysis: Fitting the 2009 Output Decline 9. Regression Analysis: Actual vs. Predicted Change in Output Growth, 2007-098. Regression Analysis (Panel GMM): Baseline Specification for Consumption/GDP, All Years; 9. Regression Analysis (Panel GMM): Baseline Specification for Investment/GDP, All Years; B. The Role of Policy; 10. Correlations Between Some Policy Variables and Growth, in the Aftermath of Adverse Shocks to External Demand, Years> = 1989; 11. Regression Analysis (Panel GMM): Impact on Output Growth of Reserves, Based on Specification with Asymmetries, All Years 12. Regression Analysis (Panel GMM): Impact on Output Growth of Labor Market Flexibility, All Years13. Regression Analysis (Panel GMM): Impact on Output Growth of Labor Market Flexibility, Based on Specification with Asymmetries, All Years; V. Growth Forecasts; 14. Growth Forecasts, Average for 2010-11; VI. Conclusions; 1. Country Sample; 2. Data Sources; 3. Additional Results; 3.1 Openness and Per Capita GDP Growth in Non-Fuel-Exporting LICs and MICs, 2007-09; 3.2 FDI Inflows and GDP Growth in Non-Fuel-Exporting LICs and MICs, 2007-09 3.3 Terms of Trade and GDP Growth in Non-Fuel-Exporting LICs and MICs, 2007-093.1 Cross-Country Quartiles Analysis for Non-Fuel-Exporting MICs; 3.2 Cross-Country Quartiles Analysis for Non-Fuel-Exporting LICs and MICs; 3.3 Cross-Country Quartiles Analysis for All LICs and MICs; 3.4 Regression Analysis (Panel GMM): Alternative Specification for Output Growth, All Years; 3.5 Regression Analysis: Fitting the 2009 Output Decline.; 3.6 Regression Analysis: Fitting the 2009 Output Decline; 3.7 Regression Analysis (Panel GMM): Baseline Specification for Government Expenditure/GDP, All Years Summary This paper investigates the short-run effects of the 2007-09 global financial crisis on growth in (mainly non-fuel exporting) low-income countries (LICs). Four conclusions stand out. First, for many individual LICs, 2009 was not extraordinarily calamitous; however, aggregate LIC output declined sharply because LICs were unusually synchronized. Second, the growth declines are on average well explained by the decline in export demand. Third, if the external environment facing LICs improves as forecast, their growth should rebound sharply. Finally, and contrary to received wisdom, there are few robust relationships between the cross-country growth variation and the policy and structural environment; the main exceptions are reserve coverage and labor-market flexibility Bibliography Includes bibliographical references Notes English Subject Economic development -- Developing countries -- Econometric models Financial crises -- Developing countries -- Econometric models Global Financial Crisis, 2008-2009. Economic development -- Econometric models Financial crises -- Econometric models Developing countries Form Electronic book Author Berg, Andrew, author International Monetary Fund. Research Department, issuing body. International Monetary Fund. Strategy, Policy, and Review Department, issuing body. ISBN 9781455278107 1455278106 145521681X 9781455216819 1283566311 9781283566315 1462300227 9781462300228 9786613878762 6613878766

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