Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/166724
Authors: 
Didier, Tatiana
Kose, M. Ayhan
Ohnsorge, Franziska
Ye, Lei Sandy
Year of Publication: 
2015
Series/Report no.: 
Koç University-TÜSİAD Economic Research Forum Working Paper Series 1529
Abstract: 
Emerging markets (EM) face their fifth consecutive year of slowing growth and a possibly longer period of sluggish performance than previously thought. This paper presents a comprehensive analysis of the nature of and the appropriate policy responses to the growth slowdown in EM. It reports three main results. First, the slowdown is synchronous and protracted, affecting a sizable number of EM, especially large ones. Second, it has been driven by both external factors, including weak world trade, low commodity prices, and tightening financial conditions; and domestic factors, including slowdown in productivity growth, bouts of policy uncertainty, and an erosion of policy buffers. Both structural and cyclical factors have contributed to the slowdown. Third, the room for accommodative cyclical fiscal and monetary policies is limited in many EM, lending urgency to putting in place structural reforms to upgrade governance structures, improve business environments, raise human and physical capital, and manage demographic pressures.
Subjects: 
emerging markets
growth slowdown
policy space
monetary policy
fiscal policy
structural reforms
JEL: 
E60
F6
F43
O4
O43
Document Type: 
Working Paper

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