The Impact of the Great Recession on Emerging Markets

IMF Working Papers, October 1, 2010

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The Impact of the Great Recession on Emerging Markets

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Bibliographic details

• Authors: Ferhan Salman, Mali Chivakul, Ricardo Llaudes
• Published: October 1, 2010
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781455209378.001

Main findings and analysis

• The paper examines the impact of the recent global crisis on emerging market economies (EMs).
• Cross-country analysis shows the impact of the crisis was more pronounced in EMs that had initial weaker fundamentals and greater financial and trade linkages.
• The more pronounced impact is observed along multiple dimensions:
  • growth
  • stock market performance
  • sovereign spreads
  • credit growth
• The paper finds that pre-crisis reserve holdings helped to mitigate the initial growth collapse during this crisis.
• This finding contrasts with other studies that fail to find a significant relationship between reserves and the growth decline.
• The authors argue that their preferred measure of impact is a more accurate reflection of the true impact of the crisis on EMs.

Authors, date, and publication context

• Authors: Ferhan Salman, Mali Chivakul, Ricardo Llaudes
• Publication date: October 1, 2010
• Series: Working Paper No. 2010/237
• Issue: 237
• Volume: 2010

Subject classification and keywords

• Subject: Credit, Early warning systems, Emerging and frontier financial markets, Financial crises, Stock markets
• Keywords: credit growth, crisis, EMs, short-term debt, vulnerability EMs, WP

Content in this bundle

• _wp10237 — Appendix 3. Reserve Robustness with Alternative Control Variables
  • _wp10237 — Appendix 3. Reserve Robustness with Alternative Control Variables (Markdown version)
  • _wp10237 — Appendix 3. Reserve Robustness with Alternative Control Variables (PDF)