{
  "title": "What’s the Damage? Medium-term Output Dynamics After Banking Crises",
  "publication": "IMF Working Papers, November 1, 2009",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/whats-the-damage-medium-term-output-dynamics-after-banking-crises-23389",
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  "summary": "This paper investigates the medium-term behavior of output following banking crises, and its association with pre- and post-crisis conditions and policies. We find that output tends to be depressed substantially following banking crises, with no rebound to the precrisis trend.",
  "sections": [
    {
      "heading": "Overview",
      "content": "- Title: What’s the Damage? Medium-term Output Dynamics After Banking Crises\n- Authors: Abdul d Abiad, Petya Koeva Brooks, Irina Tytell, Daniel Leigh, Ravi Balakrishnan\n- Date: November 1, 2009\n- Series: Working Paper No. 2009/245\n- Pages: 37"
    },
    {
      "heading": "Key findings on output dynamics",
      "content": "- Output tends to be depressed substantially following banking crises, with no rebound to the precrisis trend.\n- Growth does eventually tend to return to its precrisis rate, with substantial crosscountry variation in outcomes.\n- The depressed path of output typically results from reductions of roughly equal proportions in:\n  - the employment rate,\n  - the capital-to-labor ratio, and\n  - total factor productivity.\n- Initial conditions strongly associated with medium-run output losses include:\n  - the short-run change in output,\n  - the occurrence of a joint banking-and-currency crisis, and\n  - a high precrisis level of investment.\n- Short-run fiscal and monetary stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend."
    },
    {
      "heading": "Policy implications and interpretations",
      "content": "- Short-run fiscal stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend.\n- Short-run monetary stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend.\n- Addressing the employment rate, the capital-to-labor ratio, and total factor productivity is important because reductions in all three contribute roughly equally to the depressed output path."
    },
    {
      "heading": "Subject tags and keywords (as provided)",
      "content": "- Subject: Banking crises, Currency crises, Financial crises, Structural reforms, Total factor productivity\n- Keywords: crisis trend, growth performance, investment share result, output dynamics, output loss, severity control variable, WP\n\n---\n\n Content in this bundle\n\n- Wp09245\n  - Wp09245 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Wp09245 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/whats-the-damage-medium-term-output-dynamics-after-banking-crises-23389"
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    "Authors: Abdul d Abiad, Petya Koeva Brooks, Irina Tytell, Daniel Leigh, Ravi Balakrishnan",
    "Published: November 1, 2009",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451873924.001",
    "Title: What’s the Damage? Medium-term Output Dynamics After Banking Crises",
    "Authors: Abdul d Abiad, Petya Koeva Brooks, Irina Tytell, Daniel Leigh, Ravi Balakrishnan",
    "Date: November 1, 2009",
    "Series: Working Paper No. 2009/245",
    "Pages: 37",
    "Output tends to be depressed substantially following banking crises, with no rebound to the precrisis trend.",
    "Growth does eventually tend to return to its precrisis rate, with substantial crosscountry variation in outcomes.",
    "The depressed path of output typically results from reductions of roughly equal proportions in:",
    "Initial conditions strongly associated with medium-run output losses include:",
    "Short-run fiscal and monetary stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend.",
    "Short-run fiscal stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend.",
    "Short-run monetary stimulus is associated with smaller medium-run deviations of output and growth from the precrisis trend.",
    "Addressing the employment rate, the capital-to-labor ratio, and total factor productivity is important because reductions in all three contribute roughly equally to the depressed output path.",
    "Subject: Banking crises, Currency crises, Financial crises, Structural reforms, Total factor productivity",
    "Keywords: crisis trend, growth performance, investment share result, output dynamics, output loss, severity control variable, WP",
    "**Wp09245**"
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