Resilience of Economies to Exogenous Shocks

By Aida Caldera Sanchez and Giuseppe Nicoletti. Countries are subject to economic shocks originating from long-term trends such as demography and short-term events such as financial crises, but healthy economies should be resilient to both. It is important to understand the factors that shape a country’s economic resilience, defined broadly as a country ability to contain long and short-term vulnerabilities as well as its capacity to resist and recover quickly when shocks occur. More...