Working Paper: CEPR ID: DP7901
Authors: Andrew K. Rose; Mark M. Spiegel
Abstract: We update Rose and Spiegel (2009a, b) and search for simple quantitative models of macroeconomic and financial indicators of the "Great Recession" of 2008-09. We use a cross-country approach and examine a number of potential causes that have been found to be successful indicators of crisis intensity by other scholars. We check a number of different indicators of crisis intensity, and a variety of different country samples. While countries with higher income seemed to suffer worse crises, we find few clear reliable indicators in the pre-crisis data of the incidence of the Great Recession. Countries with current account surpluses seemed better insulated from slowdowns.
Keywords: cross-section; current account; data; early warning; empirical; GDP growth; recession
JEL Codes: E65; F30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| GDP per capita (O49) | crisis intensity (H12) |
| stock market run-up (E44) | crisis intensity (H12) |
| trade linkages to the United States (F19) | crisis intensity (H12) |