The Great Recession and Small States

Jeffrey Edwards, C B Naanwaab and Scott Simkins

Economic Issues Journal Articles, 2023, vol. 28, issue 1, 81-103

Abstract: This paper raises a simple question: relative to the rest of the world, how was small state real per capita GDP growth impacted by the Great Recession of 2008-2009? While holding constant average business cycle dynamics, we isolate this shock to measure how small countries around the globe responded to the recession - something that has not been studied before. The results indicate that while small states had a more pronounced contraction than the rest of the world going into the Great Recession, their rebound was both stronger and quicker, allowing them to return to their long-run growth rates more rapidly than other countries. Additionally, the methods and data configurations used in this study will provide guidance to researchers analysing future global exogenous shocks.

Keywords: Great Recession; small states; exogenous shock; growth (search for similar items in EconPapers)
JEL-codes: E65 F02 F42 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eis:articl:123edwards

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