The Macroeconomic Policy Response to the International Financial and Economic Crisis and the G20



During the Great Depression of the 1930s, an event to which the recent crisis is often compared, the animosities of the interwar period prevented a coordinated policy response to what was essentially a global problem. Indeed, it is often argued that this failure resulted, inter alia, in the cascading competitive protectionism triggered by the Smoot–Hawley tariffs that may well have magnified a deep recession into the Great Depression. In sharp contradistinction, the G20 orchestrated a much acclaimed globally coordinated policy response to the Great Recession, in the process effectively putting in place a new institution to manage globalization.

With the prospects of the global recovery remaining uncertain, and with the IMF repeatedly downgrading its successive forecasts for global economic growth, the initial accolades received by the G20 for having forestalled a second Great Depression have yielded to questioning of the appropriateness of its policy response and its effectiveness as the premier forum for international economic co-operation.


Monetary Policy Central Bank International Monetary Fund Fiscal Policy World Trade Organization 
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Copyright information

© Springer India 2014

Authors and Affiliations

  1. 1.Economic Advisory Council to Prime Minister of IndiaNew DelhiIndia

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