Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects
The author examines whether output contraction associated with cyclical output fluctuations and economic crises have an asymmetric effect on poverty. He identifies four potential sources of asymmetry: expectations and cofident factors, credit ratio...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2001/10/1615091/business-cycles-economic-crises-poor-testing-asymmetric-effects http://hdl.handle.net/10986/19502 |
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okr-10986-195022021-04-23T14:03:43Z Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects Agenor, Pierre-Richard ADVERSE SELECTION ADVERSE SELECTION PROBLEMS AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTOREGRESSION BANK DEPOSITS BANK LENDING BANKING CRISIS BUSINESS CYCLE BUSINESS CYCLES CAPITAL MARKETS CENTRAL BANK CONSUMERS CONSUMPTION EXPENDITURES COVARIANCE MATRIX CREDIT CONSTRAINTS CREDIT RATIONING DEBT DEPENDENT VARIABLE DEVELOPING COUNTRIES DEVELOPMENT INDICATORS DYNAMIC PANEL ECONOMIC ANALYSIS ECONOMIC CRISES ECONOMIC DOWNTURNS ECONOMIC OUTLOOK ECONOMIC POLICY EDUCATED WORKERS ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL EVIDENCE EMPIRICAL STUDIES ENDOGENOUS VARIABLES EQUILIBRIUM EXCHANGE RATE EXCHANGE RATES FAMILIES FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL INSTITUTIONS FOREIGN EXCHANGE FUTURE RESEARCH GDP GDP PER CAPITA GROWTH RATE HUMAN CAPITAL INCOME INCOME GROWTH INCOME REDISTRIBUTION INCREASE POVERTY INDEPENDENT VARIABLES INFORMAL SECTOR INFORMATION PROBLEMS INNOVATION INSURANCE INTEREST RATE INTEREST RATES LABOR FORCE LABOR MARKET MACROECONOMIC ADJUSTMENT NATIONAL POVERTY LINE NET WORTH 0 HYPOTHESIS NUTRITION OPPORTUNITY COST OPTION VALUE OUTPUT GAP OUTPUT GROWTH PARENTS PERMANENT INCOME POINT DECLINE POLICY IMPLICATIONS POLICY RESEARCH POOR HOUSEHOLDS POVERTY LINE POVERTY RATE POVERTY RATES POVERTY REDUCTION PRODUCTIVITY REAL GDP REAL INCOME REAL WAGES RECESSION REDUCING POVERTY RISK PREMIUM SAFETY SAFETY NETS SAVINGS SIDE EFFECTS SIMULATION TECHNIQUES SKILLED LABOR SKILLED WORKERS SOCIAL COSTS STANDARD DEVIATION SUNK COSTS TRANSACTION COSTS UNEMPLOYMENT UNEMPLOYMENT RATE UNEMPLOYMENT RATES UNSKILLED LABOR URBAN POVERTY WEALTH The author examines whether output contraction associated with cyclical output fluctuations and economic crises have an asymmetric effect on poverty. He identifies four potential sources of asymmetry: expectations and cofident factors, credit rationing at the firm level (induced by either adeverse selection problems or negative shocks to net worth), borrowing constraints at the household level, and the "labor hoarding" hypothesis. He also identifies some testable implications of these alternative explanations. The author then proposes a vector autoregression technique (involving the detrended components of real output, the unemployment rate, real wages, and the poverty rate) to test whether the initial cyclical position of the economy, and the size of the initial drop in the output gap in a downturn, matter in assessing the extent to which output shocks affect poverty. He applies the technique to Brazil, using annual data for 1981-99. The results indicate that poverty responds asymmetrically to output shocks, showing less sensitivity when the economy is initially in a downturn. 2014-08-20T18:17:09Z 2014-08-20T18:17:09Z 2001-10 http://documents.worldbank.org/curated/en/2001/10/1615091/business-cycles-economic-crises-poor-testing-asymmetric-effects http://hdl.handle.net/10986/19502 English en_US Policy Research Working Paper;No. 2700 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Latin America & Caribbean Brazil |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ADVERSE SELECTION ADVERSE SELECTION PROBLEMS AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTOREGRESSION BANK DEPOSITS BANK LENDING BANKING CRISIS BUSINESS CYCLE BUSINESS CYCLES CAPITAL MARKETS CENTRAL BANK CONSUMERS CONSUMPTION EXPENDITURES COVARIANCE MATRIX CREDIT CONSTRAINTS CREDIT RATIONING DEBT DEPENDENT VARIABLE DEVELOPING COUNTRIES DEVELOPMENT INDICATORS DYNAMIC PANEL ECONOMIC ANALYSIS ECONOMIC CRISES ECONOMIC DOWNTURNS ECONOMIC OUTLOOK ECONOMIC POLICY EDUCATED WORKERS ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL EVIDENCE EMPIRICAL STUDIES ENDOGENOUS VARIABLES EQUILIBRIUM EXCHANGE RATE EXCHANGE RATES FAMILIES FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL INSTITUTIONS FOREIGN EXCHANGE FUTURE RESEARCH GDP GDP PER CAPITA GROWTH RATE HUMAN CAPITAL INCOME INCOME GROWTH INCOME REDISTRIBUTION INCREASE POVERTY INDEPENDENT VARIABLES INFORMAL SECTOR INFORMATION PROBLEMS INNOVATION INSURANCE INTEREST RATE INTEREST RATES LABOR FORCE LABOR MARKET MACROECONOMIC ADJUSTMENT NATIONAL POVERTY LINE NET WORTH 0 HYPOTHESIS NUTRITION OPPORTUNITY COST OPTION VALUE OUTPUT GAP OUTPUT GROWTH PARENTS PERMANENT INCOME POINT DECLINE POLICY IMPLICATIONS POLICY RESEARCH POOR HOUSEHOLDS POVERTY LINE POVERTY RATE POVERTY RATES POVERTY REDUCTION PRODUCTIVITY REAL GDP REAL INCOME REAL WAGES RECESSION REDUCING POVERTY RISK PREMIUM SAFETY SAFETY NETS SAVINGS SIDE EFFECTS SIMULATION TECHNIQUES SKILLED LABOR SKILLED WORKERS SOCIAL COSTS STANDARD DEVIATION SUNK COSTS TRANSACTION COSTS UNEMPLOYMENT UNEMPLOYMENT RATE UNEMPLOYMENT RATES UNSKILLED LABOR URBAN POVERTY WEALTH |
| spellingShingle |
ADVERSE SELECTION ADVERSE SELECTION PROBLEMS AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTOREGRESSION BANK DEPOSITS BANK LENDING BANKING CRISIS BUSINESS CYCLE BUSINESS CYCLES CAPITAL MARKETS CENTRAL BANK CONSUMERS CONSUMPTION EXPENDITURES COVARIANCE MATRIX CREDIT CONSTRAINTS CREDIT RATIONING DEBT DEPENDENT VARIABLE DEVELOPING COUNTRIES DEVELOPMENT INDICATORS DYNAMIC PANEL ECONOMIC ANALYSIS ECONOMIC CRISES ECONOMIC DOWNTURNS ECONOMIC OUTLOOK ECONOMIC POLICY EDUCATED WORKERS ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL EVIDENCE EMPIRICAL STUDIES ENDOGENOUS VARIABLES EQUILIBRIUM EXCHANGE RATE EXCHANGE RATES FAMILIES FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL INSTITUTIONS FOREIGN EXCHANGE FUTURE RESEARCH GDP GDP PER CAPITA GROWTH RATE HUMAN CAPITAL INCOME INCOME GROWTH INCOME REDISTRIBUTION INCREASE POVERTY INDEPENDENT VARIABLES INFORMAL SECTOR INFORMATION PROBLEMS INNOVATION INSURANCE INTEREST RATE INTEREST RATES LABOR FORCE LABOR MARKET MACROECONOMIC ADJUSTMENT NATIONAL POVERTY LINE NET WORTH 0 HYPOTHESIS NUTRITION OPPORTUNITY COST OPTION VALUE OUTPUT GAP OUTPUT GROWTH PARENTS PERMANENT INCOME POINT DECLINE POLICY IMPLICATIONS POLICY RESEARCH POOR HOUSEHOLDS POVERTY LINE POVERTY RATE POVERTY RATES POVERTY REDUCTION PRODUCTIVITY REAL GDP REAL INCOME REAL WAGES RECESSION REDUCING POVERTY RISK PREMIUM SAFETY SAFETY NETS SAVINGS SIDE EFFECTS SIMULATION TECHNIQUES SKILLED LABOR SKILLED WORKERS SOCIAL COSTS STANDARD DEVIATION SUNK COSTS TRANSACTION COSTS UNEMPLOYMENT UNEMPLOYMENT RATE UNEMPLOYMENT RATES UNSKILLED LABOR URBAN POVERTY WEALTH Agenor, Pierre-Richard Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| geographic_facet |
Latin America & Caribbean Brazil |
| relation |
Policy Research Working Paper;No. 2700 |
| description |
The author examines whether output
contraction associated with cyclical output fluctuations and
economic crises have an asymmetric effect on poverty. He
identifies four potential sources of asymmetry: expectations
and cofident factors, credit rationing at the firm level
(induced by either adeverse selection problems or negative
shocks to net worth), borrowing constraints at the household
level, and the "labor hoarding" hypothesis. He
also identifies some testable implications of these
alternative explanations. The author then proposes a vector
autoregression technique (involving the detrended components
of real output, the unemployment rate, real wages, and the
poverty rate) to test whether the initial cyclical position
of the economy, and the size of the initial drop in the
output gap in a downturn, matter in assessing the extent to
which output shocks affect poverty. He applies the technique
to Brazil, using annual data for 1981-99. The results
indicate that poverty responds asymmetrically to output
shocks, showing less sensitivity when the economy is
initially in a downturn. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Agenor, Pierre-Richard |
| author_facet |
Agenor, Pierre-Richard |
| author_sort |
Agenor, Pierre-Richard |
| title |
Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| title_short |
Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| title_full |
Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| title_fullStr |
Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| title_full_unstemmed |
Business Cycles, Economic Crises, and the Poor : Testing for Asymmetric Effects |
| title_sort |
business cycles, economic crises, and the poor : testing for asymmetric effects |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2001/10/1615091/business-cycles-economic-crises-poor-testing-asymmetric-effects http://hdl.handle.net/10986/19502 |
| _version_ |
1764439897862569984 |