Cross-Country Comparison – Economic Crises Increase Inequality in the United States

The resilience test carried out by ZEW researchers includes all significant export-sector crises since the 1970s. This enables researchers to distinguish long-term crisis-management patterns within the observed economies that are not immediately evident when examining individual current crises. The study defines an export-sector crisis as a decline in exports relative to gross domestic product (GDP) of at least one quarter of a percentage point. This seemingly moderate deterioration in export performance is to be interpreted in the context of the strong growth in world trade over recent decades. For example, the German exports-to-GDP ratio increased by an annual average of 1.29 percentage points between 1970 and 2016. Against this background, a year with a decline of at least 0.25 percentage points represents a significant set-back relative to the export-growth trend. An economy’s resilience is reflected in its performance during and in the aftermath of a crisis. The evaluation of performance includes four measures of welfare: the growth rate of the real GDP, the unemployment rate, the at-risk-of-poverty rate, and the Gini coefficient for disposable income. Of the countries analysed in the study, Japan and Australia proved to be most resilient. Since the oil crises of the 1970s, both countries have repeatedly been successful in overcoming the negative effects of global trade slumps in a short space of Research Findings Germany Comes in Fourth Place Globally for Innovation