Understanding Differences in Growth Performance in Latin America and Developing Countries between the Asian and Global Financial Crises

Roberto Alvarez and Jose De Gregorio

No WP14-11, Working Paper Series from Peterson Institute for International Economics

Abstract: Latin American performance during the global financial crisis was unprecedented. Many developing and emerging countries successfully weathered the worst crisis since the Great Depression. Was it good luck? Was it good policies? In this paper we compare growth during the Asian and global financial crises and find that a looser monetary policy played an important role in mitigating crisis. We also find that higher private credit, more financial openness, less trade openness, and greater exchange rate intervention worsened economic performance. Our analysis of Latin American countries confirms that effective macroeconomic management was key to good economic performance. Finally, we present evidence from a sample of 31 emerging markets that high terms of trade had a positive impact on resilience.

Keywords: Latin America; Emerging Markets; Developing Countries; Global Financial Crisis; Macroeconomic Policies (search for similar items in EconPapers)
JEL-codes: E58 E63 F3 (search for similar items in EconPapers)
Date: 2014-11
New Economics Papers: this item is included in nep-fdg, nep-lam, nep-mac and nep-sea
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Citations: View citations in EconPapers (12)

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Journal Article: Understanding Differences in Growth Performance in Latin America and Developing Countries between the Asian and the Global Financial Crises (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:iie:wpaper:wp14-11

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