{
  "title": "Feeling the Pinch",
  "publication": "IMF Blog, December 28, 2016",
  "sourceUrl": "https://www.imf.org/en/blogs/articles/2016/12/28/feeling-the-pinch",
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  "summary": "Publication: iMFdirect blog entry titled \"Feeling the Pinch\"",
  "sections": [
    {
      "heading": "Overview",
      "content": "- Publication: iMFdirect blog entry titled \"Feeling the Pinch\"\n- Date: December 28, 2016\n- Context: Summarizes analysis published in the December issue of Finance & Development magazine on how global trade contraction after the global financial crisis reflected changes in consumer choice as well as lower demand."
    },
    {
      "heading": "Key findings and mechanisms",
      "content": "- World trade \"essentially collapsed\" following the global financial crisis as consumers and businesses cut back spending on both domestic and foreign products.\n- Decline in demand reduced the value of global imports and exports.\n- Consumer choice contributed: consumers shifted toward cheaper, lower-quality goods.\n- Because consumption of higher-quality goods is generally more sensitive to changes in income than that of lower-quality items, a sudden reduction in income may lead to a \"flight from quality.\"\n- A \"flight from quality\" implies households reduce not only the quantity but also the quality of goods consumed, producing a larger contraction in higher-quality imports than in lower-quality imports."
    },
    {
      "heading": "Empirical illustration",
      "content": "- Case studied: wine made in Argentina.\n- Finding: In the case of Argentine wine exports, the global financial crisis induced a \"flight from quality.\""
    },
    {
      "heading": "Additional pointers",
      "content": "- The blog points readers to recent IMF analysis, including a recent blog about the IMF’s annual check-up of Argentina’s economy.\n- About IMFBlog: a forum for views of IMF staff and officials on pressing economic and policy issues.\n- Institutional context: The IMF is based in Washington D.C. and is an organization of 191 countries, working to foster global monetary cooperation and financial stability.\n\nSource: Feeling the Pinch, iMFdirect, December 28, 2016.\n\n---\n\n\n References\n\n- Finance & Development magazine\n- Argentine wine exports\n- blog\n\nSource: https://www.imf.org/en/blogs/articles/2016/12/28/feeling-the-pinch"
    }
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    "Authors: iMFdirect",
    "Published: December 28, 2016",
    "Publication: iMFdirect blog entry titled \"Feeling the Pinch\"",
    "Date: December 28, 2016",
    "Context: Summarizes analysis published in the December issue of Finance & Development magazine on how global trade contraction after the global financial crisis reflected changes in consumer choice as well as lower demand.",
    "World trade \"essentially collapsed\" following the global financial crisis as consumers and businesses cut back spending on both domestic and foreign products.",
    "Decline in demand reduced the value of global imports and exports.",
    "Consumer choice contributed: consumers shifted toward cheaper, lower-quality goods.",
    "Because consumption of higher-quality goods is generally more sensitive to changes in income than that of lower-quality items, a sudden reduction in income may lead to a \"flight from quality.\"",
    "A \"flight from quality\" implies households reduce not only the quantity but also the quality of goods consumed, producing a larger contraction in higher-quality imports than in lower-quality imports.",
    "Case studied: wine made in Argentina.",
    "Finding: In the case of Argentine wine exports, the global financial crisis induced a \"flight from quality.\"",
    "The blog points readers to recent IMF analysis, including a recent blog about the IMF’s annual check-up of Argentina’s economy.",
    "About IMFBlog: a forum for views of IMF staff and officials on pressing economic and policy issues.",
    "Institutional context: The IMF is based in Washington D.C. and is an organization of 191 countries, working to foster global monetary cooperation and financial stability.",
    "[Finance & Development magazine](http://www.imf.org/external/pubs/ft/fandd/2016/12/index.htm)",
    "[Argentine wine exports](http://www.imf.org/external/pubs/ft/fandd/2016/12/chen.htm)",
    "[blog](https://blogs.imf.org/2016/11/21/redesigning-argentinas-economic-landscape/)"
  ],
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