A Few White Papers
you are currently viewing::IMF Working Paper-Understanding the Macroeconomic Effects of Natural DisastersFebruary 21, 2025-Summary As a result, output growth in AEs is not significantly affected by natural disasters. In contrast, the increase in government expenditure in emerging markets and developing countries (EMDEs) after a natural disaster is smaller and thus, unable to mitigate the contemporaneous negative effect on output growth (which mainly reflects the fall in investment in non-small-island EMDEs and in net exports in small-island EMDEs). In addition, the output recovery in the subsequent year does not fully offset the decline during the year of the disaster. Second, this paper assesses the role of pre-existing country characteristics in mitigating the adverse impact of natural disasters. The paper finds that small islands and countries with limited pre-disaster fiscal space tend to experience more significant declines in output growth following a natural disaster. Source: imf.org |
IMF-Walkways, Not Walls
December 31, 2024 -Macroeconomics, by definition, focuses on the big picture. It neglects smaller micro developments at the business or sectoral level. In 2007, Edward Leamer, an economics professor at the University of California, Los Angeles, pointed out the high costs of this neglect by arguing that it's meaningless to try to understand business cycles without paying attention to the housing sector.