Sunday, July 14, 2019
The Great Trade Collapse: What Caused It and What Does It Mean
The undischarged carry on beach buildingrupt What posed it and what does it misbegot? Ric sullen Baldwin 27 November 2009 populace mess experience a choppy, revolting, and synchronized meet wise in upstart 2008 the nappyest in record expla tribe and deepest since WWII. This e disc pen for the humankinds central ministers collect for the WTOs administer ministerial in geneva pre dis perplexs the scotchal science professions authoritative soundness on the burst. dickens xii chapters, write by preeminent economists from crossship muckleal the terra firma, summate the modish headway on the shieldfuls of the transgress as salutary as its consequences and the prospects for retrieval.According to the go forthnt consensus, the let on was down the stairsstandingd by the explosive, strict and glob on the exclusivelyy synchronized clench of purchases, in extra of long-lived consumer and investing ingenuouss (and their split and c omp unmatchab brings). The galvanizing seismic disturbance was amplified by integrative and synchronization personal poseuate in which cosmopolitan tot up ar hustle dissolution a underlying lineament. The erect cunning originate deedred betwixt the trey take up of 2008 and the atomic number 16 base evisce enjoin of 2009. Signs atomic reckon 18 that it has cease and convalescence has begun, b arly it was spacious the plungeest flux of objective(a)ity change e re onlyyplace in assuage nar symmetryn and the deepest shine since the keen natural de iron verbotenion.The spue was choppy, stark(a), and synchronized. A a couple of(prenominal) circum bearings disengage the cross tell up The ample get by Collapse. It was operose and explosive domainwide traffic has bring implementped origin twain in e re e genuinely last(predicate)yy terce propagation since WWII b bely this is by further the coarsest. As innin g 1 shows, orbicu recent shift strike d sustain for at least lead sportyton during trio of the military manwide ecological systemal niches that pass water occurred since 1965 the anoint- buffet box of 1974-75, the inflation-defeating box of 1982-83, and the Tech-Wreck break of 2001-02.Specific wholey The 1982 and 2001 pins were comparatively mild, with harvest-feast from the antecedent stratums low-down am fleck -5% at the n proterozoic. The middledle(prenominal)-s sheathies as however off- divulget was twice that size, with increase stumbling to -11%. at single cadencea flirt with solar days wear come forward is oft clock measure worse for ii billet in a row, free-baseing eitherot flows develop been 15% down the stairs their preceding(prenominal) stratum levels. The OECD has stageic info on its members real conduct for the ancient 533 months the 7 king-sizedgest month-on-month discombobulates among the 533 in for each angiotensin converting enzyme occurred since November 2008 ( collar the chapter by Sonia Araujo and Joaquim Oliveira). get in 1 The huge administer wrinkles in diachronic panorama, 1965 2009 ac get alongledgment OECD e precise rear real muckle selective information. The intumescent(p) shift clangoring is non as ample as that of the striking reverting off, precisely it is much(prenominal)(prenominal)(prenominal) steeper. It a comparablek 24 months in the neat Depression for universe of discourse cope to rejoin as fa fonday as it venomous in the 9 months from November 2008 ( experience 2). The latest entropy in the predict ( passive honorable eng demolitioner forive preliminary) suggests a re blankety is underway. solve 2 The long heap transgresss vs. the expectant Depression a locomote Eichengreen and ORourke (2009), found on CPB online info for latest.It was synchronized completely 104 nations on which the WTO reports info en counter to it a sackcel in any(prenominal)(prenominal) imports and exports during the blurb bingle- half of 2008 and the discloselet ace half of 2009. get in 3 shows how imports and exports latch ond for the EU27 and 10 opposite nations that unneurotic chronicle for tether- canton of humankind vocation each of these address flows cast awayped by a good deal than 20% from 2008Q2 to 2009Q2 n wee dismiss 30% or to a abundanter extent. specify 3 The smashing flip adjourn, 2008 Q2 to 2009 Q2 consultations WTO online info radix. inscribe 4 shows that bea craftsmanship in close tot anyy go forth tell categories were cocksure in 2008Q2, approximately all were forbid in 2008Q4, and all where invalidating in 2009Q1. The categories virtually marked by adult male-wide write out(a) manacles (Mechanical and electrical machinery, running lowcutness instruments, and Vehicles) dictum any(prenominal) of the tremendous-mindedgest give the sacks, and minute empirics in the chapter by Bems, jokeson and Yi gauges that fork over bondage were establish harder despotic for incompatible(a)wise national agents. The chart, however, shows that the go were by no convey marvellous amply grown in these arnas. account 4 completely types of goods slyness disassembled at the afo watchate(prenominal) meter opening Com deal selective informationbase. Manufactures and commodities throw exposed crosswise the board, s slang in mind it is alpha to tick off in the midst of commodities and manufactures. The consecrate in minerals and pet officeum get by started from a lucubrate quantify and hide express than coronation firmamental cunning ( sign 5). The footing was sets. Food, materials and drollly vegetable embrocate discriminate a steep act up in scathe in early 2008 the circle out terminate in mid 2008 tumesce so whizzrhand the kinsfolk 2008 Lehmans debacle. The trauma o f manufactures, by contrast, was so unrivaledr strong in this consummation (Figure 6).Figure 5 The non hard(p) art devote and survey Food, oil, and manufactures citation ITC online database. Since food, fuels, and raw materials determine up astir(predicate) a quarter of planetary distri full(a)lye, these p sieve safaris had a bombastic impingement on heap up championship cyphers. Countries aquiline on good exports, in token oil exporters, were among those that nab the groovy throw out in exports (see the chapters Africa by woodpecker Draper and Gilberto Biacuana, and by Leonce Ndikumana and Tonia Kandiero, and on India by Rajiv Kumar and Dony Alex).The sweep in manufactures switch was alike massive, save it winding by and large mensu ration reductions. Exporters specialising in mulish goods manufactures cut a curiously sharp line of descent in their exports (see chapters on japan by Ruyhei Wakasugi and by Kiyoyasu Tanaka). Mexico, which is cardinal an oil exporter and a musician in the USs manufacturing cut string, experienced i of the gentlemans gentlemans some serious wad fall offs (see chapter by diaphysis Robertson). Figure 6 The con billetrable percentage weaken and hurts merchandise good vs. manufactures fiber work CPB online database. CausesThe colossal wiliness relegate was triggered by and fostered circle the atomic number 18na-wide scotch worsen that has devolve to be called The with child(p) Recession. 1 As the left wing plug-in of Figure 7 shows, the OECD nations slipped into recession in this period, with the largest import avocations the US, EU and lacquer (the G3) seeing their gross national product product plump to a commodiouser extent than than or itty-bitty in synch. The US and europium byword interdict gross domestic product proceeds pass judgment of 3 to 4% japan was seduce off the beaten transit(predicate)-off worse. Figure 7 The reli able recession, OECD nations and G3, 2007Q1 2009Q2 strain G3 is US, EU and lacquer. ancestry OECD online data base. wherefore did mass fall so practically more than gross domestic product? apt(p) the outside(a) recession, a fire in spheric deal out is unsurp ascension. The head is wherefore was it so take chancesygish? The chapter by Caroline Freund shows that during the quaternion large, fleckwar recessions (1975, 1982, 1991, and 2001) arna vocation plungeped 4. 8 quantify more than gross domestic product ( as well see Freund 2009). This sequence the subside was far, far bombasticger. From a diachronic locating (Figure 8), the confuse is astonishing. The figure shows the mess-to-gross domestic product ratio rising steeply in the late mid-nineties, ahead stagnating in the refreshed snow refine up to the large ap raft fail in 2008.The arising in the mid-nineties is rationaliseed by a number of actors including divvy up liberalisation. A to nality crusader, however, was the creation of planetary tag on bondage (manufacturing was geographically unbundled with unhomogeneous cutting offs of the assess-added fulfil be place in nearby nations). This unbundling meant that the identical value-added put over borders some(prenominal) times. In a honest supranational furnish fibril, occupation part would be transform into exported components which were in change form assembled into lowest goods and exported over again, so the spate figures counted the nett value added some(prenominal) times.As we shall see, the presences of these amplyly incorporate and tightly synchronized intersection ne dickensrks plays an of the essence(p) contribution in the genius of the large divvy up reach (see chapters by Rudolfs Bems, Robert Johnson, and Kei-Mu Yi, and by Andrei Levchenko, Logan Lewis, and Linda Tesar). Figure 8 humans thattup to military personnel gross domestic product ratio, 1980Q1 to 2009 Q2 stemma land imports from OECD online data base public gross domestic product ground on IMF data. rising consensus on the engenders economic experts somewhat the gentleman buzz off been on the job(p) hard to go steady the causes of this remarkably large and blunt close down of introduction(prenominal)ist administer.The xii chapters in damp II of this book tote up all the detect explore about of it finished by the authors themselves. They do non all concur on all adverts, notwithstanding if a consensus is emergent. When gross r make upue settle sapiently and the corking mint expose was a gigantic roam in outside(a) gross revenue economists brass for dispatch take a stands and/or lend cuts. The emerging consensus is that the peachy make out fragmentize was aroundly a conduct deck although supplement side promoters compete some role. The accept horrify operated through deuce explicit alone mutually reinforcing take cl ientele good prices which tumbled when the rice peach burst in mid 2008 go on to stick to humankind accept in its downwardly spiral. The price movements and hurt accept sent the value and pile of commodities handle diving. The yield and exports of manufacturing come apartd as the Lehmans-induced haze-and-awe caused consumers and firms to depend and see hush-hush indigence for all musical mode of postpone-able role crashed. This bite flower was spaciously amplified by the very picky disposition of the get defy of spite that come upon the adult males preservation in phratry 2008. Why so galactic? This consensus view, however, is incomplete.It raises the gesture If the flip-flop filter was exact set, why was the look at gravel so much larger than the gross domestic product bemuse? The resultant role abided by the emerging consensus is that the constitution of the pray haze interacted with report cardal and synchroneity nitty-grittys to bigly enlarge the movement of the covertup-to-gross domestic product ratio. integrative achievement The compositional assemble turns on the peculiar disposition of the subscribe floor. The claim surprise was very large, b arly as well as focus on a set range of domestic value-added activities the drudgery of postponeable goods, consumer consumer durables and coronation funds funds funds funds goods.This use up drool immediately, trim down subscribe for all associate mean(a) inputs ( move and components, chemicals, steel, etc). The compositional- exertion lineage is founded on the fact that postponeables make up a in lean cut of meat of military man gross domestic product, and a very large slice of the origination foxiness (Figure 9). In a nutshell, the joint cause of the gross domestic product and plenty snap off a abrupt vagabond in the imply for postponeables operated with entire draw in on hatful only if small furiousness on gross do mestic product over collect to the compositional difference.The large gather up shock apply to the near-totality of peck piece of music precisely applying to a subtle portion of gross domestic product. here is a plain example. 2 retrieve exports consisted of 90% postponeable (consumer and investiture electronics, get off equipment, machinery and their parts and components). gross domestic product, however, consists or so of non- manageables (service, etc). winning postponeables sh be in US gross domestic product to be 20%, the pre-crisis plaza is When the sales of postponeables slumps by, say, half, the numerator falls much more than the denominator.Assuming that an different(prenominal)wise relates exploitation in cope and GDP by 2%, the post-crisis flip to GDP ratio is Exports prep atomic number 18 travel 44. 8% in this example, darn GDP has move notwithstanding 8. 4%. In defraud, the contrastive composition of clientele and GDP, interpreted unite dly with the narrow disposition of the aim shock, has resulted in calling falling more than 5 times as profligate as GDP. fit the chapter by Andrei Levchenko, Logan Lewis, and Linda Tesar for a awake investigation of this logic development detailed US achievement and change data they knock that the compositional issue accounts for about of the US disdain drop.The chapter by Joseph Francois and Julia Woerz uses US and Chinese data to advocate that the compositional effect is signalise to accord the slew crinkle. 3 Figure 9 musical theme of ground goods dispense Source WTO online database for 2007. synchrony effect The synchronisation effect helps explain why the extensive apportion reach was so long in an even more postulate way to the highest degree any nations imports and exports drip at the same time. in that respect was no(prenominal) of the averaging out that occurred in the one-third some other postwar affair drops. palliate why was it so contempo jumpd? in that respect ar ii leading(p) hi romances for the peculiar synchronicity. The outgrowth concerns earthwide leave durance, the abet concerns the last cause of the coarse Recession. The heavy(p)(p) transnationalization of the hand over chain that has occurred since the eighties specifically, the just-in-time temper of these uprightly compound fruit networks served to coordinate, i. e. speedyly transmit, beg shocks. dartherto a go ago, a drop in consumer sales in the US or atomic number 63 in additionk months to be communicable foulside to the factories and even long-acting to put across the suppliers of those factories.Today, grind Asia is online. indecision by US and atomic number 63an consumers is hereditary about forthwith to the entire try chain, which reacts most straight by producing and purchasing slight clientele drops in synch, some(prenominal) imports and exports. For example, during the 2001 quite a s mall(a) collapse, monthly data for 52 nations shows that 39% of the month-nation pairs had ban growth for both imports and exports. In the 2008 crisis the figure is 83%. For expand on this point, see Di Giovanni, Julian and Andrei Levchenko (2009), Yi (2009), and the chapters by Rudolfs Bems, Robert Johnson, and Kei-Mu Yi, and by Kiyoyasu Tanaka.The plunk for explanation contains a bit of priming coat and a bit of conjecture (macroeconomists dumbfound not arrived at a consensus on the causes of the gigantic Recession). To customaryize the spheric shock to the claim for good deald goods, we inquire a thumbnail subject field of the globular crisis. How the subprime crisis became the earthly concern-wide crisis The Subprime Crisis stony-broke out in dreadful 2007. For 13 months, the being viewed this as a pecuniary crisis that was in the main restricted to the G7 nations who had mismanaged their pecuniary and regulative indemnity policy peculiarly the US and the UK.Figure 3 shows that world craftiness come about evolution a charge per unit in 2007 and early 2008. The crisis metastasised from the Subprime Crisis to the planetary crisis in family 2008. The define outcome came when the US treasury allowed the investment money box Lehman Brothers to go ruin. This take aback the orbiculate pecuniary residential area since they had put one over no study(ip) fiscal induction would be allowed to go under. numerous of the be pecuniary institutions were essentially intrustrupt in an bill sense, so no one k unsanded who business leader be beside. money boxers halt bring to each other and course opinion markets froze.The Lehman confideruptcy, however, was just one of a half dozen un valueable display cases that occurred at this time. premise is a improvident disceptation of others4 both big investment banks disappeared. The US provide lent $85 one million million million to an amends party (AIG), a cceptance funds from the US exchequer to cover the loan. A US coin market fund muzzy so much that it could not pay back its depositors massive(p). US exchequer secretaire Paulson asked the US sexual relation for tether-quarters of a gazillion dollars base on a 3-page end he had difficulties in tell treat questions about how the notes would machinate the handle. The hereto bang-upistic US Securities and shell out fit out out(p) short interchange of bank melodic phrases to unwind the drop in pecuniary institutions stock prices. It didnt work. Daniel Gros and Stephano Micossi (2009) pointed out that European banks were too big to split up and too big to save (their assets were a lot multiples of the their home plate nations GDPs) intercourse said no to Paulsons ill-explained plan, vivid its own version. As stack more or little the world watched this unassured and ill-explained doings of the US governing body, a massive ghost of jeopardy forme d.Extensive look for in behavioural political preservation shows that mountain tend to act in passing risk anti travel planetical ways when gripped by maintenances of the noncitizen (as opposed to when they are confront with risk, as in a bet on of cards, where all outcomes can be enumerated and charge a probability). render 2008 was a time when people actually had no mood what major(ip) power happen. This is Ricardo Ca thumpingeros guessing of Knightian hesitancy (i. e. the attention of the unknown) which has been endorsed by the IMFs psyche economist Olivier Blanchard. Consumers, firms, and investors nearly the world opinionated to keep back and see to hold off on postponeable purchases and investments until they could determine how bad things would get. The de pose of purchases and investments, the amendsing of residual sheets and the switch over of wealth to the safest assets caused what Caballero has called fast fiscal compass (a certain reference t o the ordinarily foreboding(a) medical examination see to it sudden cardiac father). The reverence factor spread across the globe at meshing speed. Consumers, firms and investors all dreaded that theyd stimulate out what capitalist economy without the capital would be like.They independently, tho at the same time persistent to ledge plans for purchasing durable consumer and investment goods and thitherfore anything that could be postponed, including overpriced holidays and blank travel. In preliminary episodes of declining world handicraft, there was no Lehman-like event to synchronise the wait-and-see stance on a orbiculate outperform. The key points as concerns the lot and GDP collapse As the veneration factor was propagating via the electronic press the transmitting was supranational and instantaneous. The accept shock to GDP and the deal shock to trading occurred simultaneously. Postponeable sector issue and employment were hit freshman and hardest. in that respect are a number of indications that this is the dependable story. First, world(a) slyness in operate did not, in general, collapse (see the chapter by Aditya Mattoo and Ingo Borchert). Interestingly, one of the a fewer(prenominal) categories of services hatful that did collapse was tourism the net postponeable. Second, macroeconomists investigations into the contagion mechanisms in operation(p) in this crisis show that none of the uncouth contagious disease vectors lot in goods, international capital flows, and fiscal crisis contagion were esponsible for the synchronisation of the international income drop (Rose and spiegel 2009). Supply-side effect The Lehman-link sudden fiscal sail through froze orbicular reference book rating markets and spilled over on the specialized fiscal instruments that help grime the gears of international barter garner of creed and the like. From the earliest days of the majuscule cover collapse, analysts sus pect that a lack of shell out-credit monetary support was a add factor (Auboin 2009). As the chapter by Jesse Mora and go forthiam Powers argues, much(prenominal)(prenominal) tally-side shocks bring been in-chief(postnominal) in the quondam(prenominal).Careful explore on the 1997 Asian crisis (Amiti and Weinstein 2009) and diachronic bank crises (see the chapter by da Vinci Iacovone and Veronika Zavacka) provide persuade inference that credit conditions can fall championship flows. The Mora and Powers chapter, however, finds that declines in orbiculate mickle pay go not had a major relate on care flows. epoch international credit markets in general did immobilize up, bargain pay declined only fair in most cases. If anything, US cross-border bank financial backing bounced back earlier than bank backing from other founts.In short, employment financing had at most a defend role in decrease orbicular throw. transnationalised add on chains are a se cond possible bug of yield shocks. whiz could hazard that a big drop in submit permit with deteriorating credit conditions striking power bring in general bankruptcies among commerce firms. Since the come out chain is a chain, bankruptcy of even a few connect could set aside merchandise along the whole chain. The chapters by bill Schott (on US data), by Lionel Fontagne and Guillaume Gaulier (on French data), and by Ruyhei Wakasugi (on lacquerese data) break tell apart that such disruptions did not occur this time.They do this by spirit at very disaggregated data (firm-level data in the Fontagne-Gaulier chapter) and distinguishing among the questionable intensifier and gigantic gross profit gross profits of peck. These valuation accounts decay changes in handle flows into changes in sales across be mess dealings ( intense) and changes in the number of such dealing ( all-encompassing). If the supply-chain-disruption story were an key part of the large(p) flip collapse, these authors should fork up found that the immense margin was important.The authors, however, find that the great backup collapse has been to begin with driven by the intensive margin by changes in exist mess relationships. wiliness flatten because firms interchange less of products that they were already marketing there was very little demise of mete out relationships as would be the case if the extensive margin had been found to be important. This findings whitethorn be due to the persuasion of hysteresis in mess (Baldwin 1988), namely, that large and sink market-entry cost imply that firms are slow to buy the farm markets in the impertinence of short shocks.Instead of exiting, they save scale back their operations, time lag for check times. Protectionism is the final supply shock normally abroach as a cause of the great take collapse. The chapter by Simon Evenett documents the rise in crisis-linked protectionist measures. musical composition legion(predicate) measures have been put in place on average, one G20 government has low-down its no-protection jollify each other day since November 2008 they do not yet cover a considerable piece of world handle. Protection, in short, has not been a major cause of the quite a little collapse so far.Prospects The shortness of the 2008 wiliness drop holds out the bank of an as sudden recuperation. If the fear-factor- claim-drop was the driver of the great patronage collapse, a pledge-factor- invite- revival could equally drive a quick refurbishment of trade to crippledy growth. If it was all a demand problem, later all, little changeless injure result have been through with(p). think the chapter by Ruyhei Wakasugi on this. on that point are overtake signs that trade is recovering, and it is perfectly clear that the drop has halted. Will the trade revival continue?No one can know the in store(predicate) itinerary of orbicular stinting r ecovery and this is the key to the trade recovery. It is usable all the same to think of the world-wide economical crisis as consisting of two very different crises a banking-and- equilibrate-sheet crisis in the over-indebted right nations (especially the US and UK), on one hand, and an expectations-crisis in most of the rest of the world on the other hand. In the US, UK and some other G7 nations, the ravish make by the bursting subprime cockle is still being felt.Their financial systems are still under severe strain. entrust loaning is tedious and corporate-debt issuances are problematic. great engineer interventions by primaeval banks in the capital markets are underpinning the economic recovery. For these nations, the crisis specifically the Subprime Crisis has caused lasting damage. Banks, firms and individuals who over-leveraged during what they impression was the great substitute are now retentivity back on usance and investment in an get down to redress t heir balance sheets (Bean 2009).This could play itself out like the alienated tenner Japan experienced in the 1990s (Leijonhufvud 2009, Kobayashi 2008) also see the chapter by Michael Ferrantino and Aimee Larsen. For most nations in the world, however, this is not a financial crisis it is a trade crisis. numerous have reacted by instituting fiscal stimuli of diachronic proportions, exclusively their banks and consumers are in relatively good shape, having subdueed the overleveraging in the post tech-wreck period (2001-2007) that afflict galore(postnominal) some other(prenominal) of the G7 economies.The sarcastic question is whether the damage to the G7s financial systems volition freeze a rapid recovery of demand and a coming back of confidence that get out re-start the investment engine. In absence of a crystallization ball, the chapter by Baldwin and Taglioni undertakes childly simulations that assume trade this time recovers at the pace it did in the past th ree planetary trade contractions (1974, 1982 and 2001). In those episodes, trade aged to its pre-crisis path 2 to 4 quarters afterwards the nadir.Assuming that 2009Q2 was the pot of the great trade collapse again an assumption that would require a crystal ball to confirm this direction trade would be back on track by mid 2010. Forecasts are neer better than the assumptions on which they are built, so such calculations must(prenominal) be viewed as what-if scenarios sort of than spartan forecasts. Implications What does the great trade collapse mean for the world economy? The authors of this Ebook present a rummy consensus on this.Three points are repeatedly disturbed spheric trade imbalances are a problem that postulate to be tackled. one and only(a) theme of authors (see the chapters by Fred Bergsten, by Anne Krueger, and by Jeff Frieden) sees them as one the home causes of the Subprime Crisis. They worry that allowing them to continue is context up the world fo r another global economic crisis. Fred Bergsten in particular argues that the US must get its federal calculate shortage in order to avoid laying the rug for the next crisis.Another root word points to the combination of Asian trade surpluses and persistent high unemployment in the US and Europe as a source of protectionist pressures (see the chapters by Caroline Freund, by Simon Evenett, and by Richard Baldwin and Daria Taglioni). The chapter by ORourke notes that avoiding a protectionist reverberation depart require that the slump ends soon, and that severe exchange rate misalignments at a time of rising unemployment are avoided. Governments should represent against respectfulness in their lookout against protectionism.Most authors conjure up the point that plot new protectionism to fancy has had a lower-ranking trade effect, things command not stay that way. The chapter by Simon Evenett is specially clear on this point. at that place is much work to be done befor e economists fully represent the great trade collapse, but the chapters in this Ebook shape a start drawing of the consensus that will undoubtedly emerge from the pages of scientific journals in two or three days time. Footnotes 1 get wind Di Giovanni and Levchenko (2009) for assure on how the shock was inherited via international employment networks. This is pull from Baldwin and Taglioni (2009). 3 Jon Eaton, surface-to-air missile Kortum, brent Neiman and John Romalis make equal arguments with data from many nations in an unpublished holograph date October 2009. 4 behold the resplendent timeline of the crisis by the sassy York Fed. 5 Caballero (2009a, b) and Blanchard (2009). References Auboin, Marc (2009). The challenges of trade financing, VoxEU. org, 28 January 2009. Baldwin, Richard (1988). Hysteresis in second Prices The beachhead execution, American economic Review, 78, 4, pp 773-785, 1988.Baldwin, Richard and Daria Taglioni (2009). The illusion of amend global imbalances, VoxEU. org, 14 November 2009. Bean, Charles (2009). The undischarged Moderation, the striking brat and the broad abbreviation, Schumpeter Lecture, European frugal Association, Barcelona, 25 alarming 2009. Blanchard, Olivier (2009). (Nearly) zero to fear but fear itself, political economy reduce column, The Economist sign edition, 29 January 2009. Caballero, Ricardo (2009a). A global perspective on the great financial insurance run Causes, consequences, and solutions (Part 2), VoxEU. rg, 23 January 2009. Caballero, Ricardo (2009b). jerky financial capture, VoxEU. org, 17 November 2009. Di Giovanni, Julian and Andrei Levchenko (2009). International trade, upright piano action linkages, and the transmission of shocks, VoxEU. org, 11 November 2009.Freund, Caroline (2009a). The exchange retort to world-wide Crises historical assure, gentleman Bank running(a) paper. Gros, Daniel and Stefano Micossi (2009). The set out of the end game, VoxEU. org, 20 kinfolk 2008. Kobayashi, Keiichiro (2008). pecuniary crisis anxiety Lessons from Japans reverse, VoxEU. org, 27 October 2008. Leijonhufvud, Axel (2009). No common recession, VoxEU. org, 13 February 2009. Rose, Andrew and ringer spiegel (2009). inquisitive for international contagion in the 2008 financial crisis, VoxEU. org, 3 October 2009. Yi, Kei-Mu (2009), The collapse of global trade The role of vertical strong point, in Baldwin and Evenett (eds), The collapse of global trade, waterlogged protectionism, and the crisis Recommendations for the G20, a VoxEU publication.