The Impact of Great Recession on Developing Countries: The Case of India and Argentina

Abstract

The great recession starting in the US sub-prime mortgage market in 2008 was considered to be the deepest crisis since the great depression of 1929.At the very beginning of the crisis, it was considered as a local crisis but it had spread to worldwide through highly integrated financial system including both developed and developing economies. Even if the developing economies did not suffer as much as the developed ones, they were influenced through the international trade and capital flows. India and Argentina were two of those developing countries that suffered from the global crisis, even if they are located in different hemispheres and had different conditions. Therefore, examining the impact of the global crisis on these countries and their policy responses to this crisis would help to have an insight into the worldwide financial crisis.