The International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD) now the World Bank, were created in the mid-1940s. The IMF was tasked to manage the post-war international monetary system, while the World Bank’s role during its early years was to provide development finance to war-torn Europe. These institutions reformed some of their roles to make them relevant to the globalising world over the years and also responded to several post-war crises. Since these two institutions carry out their roles in a globalising world, this study has revealed that globalisation has different interpretations as many researchers refer to the economic and non-economic explanations of its meaning. Globalisation is also a historical process as it traces back several years ago. Since approximately the mid-2000s, the global economy experienced two economic crises, namely the US sub-prime financial crisis that later became the Great Recession and the Euro sovereign crisis. The two economic crises spread to other countries globally that were interconnected into the global economy regarding international trade, investment and banking. These two crisis events required responses from the IMF and the World Bank. The two institutions displayed a variety of strengths and weaknesses in dealing with the recession and the Euro crisis. The lending of both these institutions has been their strength as they have managed to expand their lending capacity during the two crisis periods examined. The IMF’s crisis intervention time frames have also been its strength, as the speed in which it has approved financial assistance requests has been within reasonable time frames. The IMF’s new lending instruments have been its weakness, as the success of these instruments has not been fully tested so far. This is because of the little use of the IMF’s new lending instruments. The IMF’s crisis prevention efforts through the use of its surveillance tools have also been its flaw. This is based on the fact that it has failed to prevent the US financial crisis (later the Great Recession) and the Euro sovereign crisis. Overall, this study found that these institutions played a significant role in responding to the Great Recession and Euro sovereign crisis as their strengths outweigh their weaknesses. However, the weaknesses of the IMF confirm that it needs to reform its role and learn from its flaws in the future.

M.Com. (Econometrics) / This dissertation investigates the ability of different models to predict a recession in South Africa (SA) by choosing a best performing model based on the smallest prediction errors made by the models. One of the purposes of using econometric models is to predict a recession, with the goal to uncover the probability of a recession or real GDP growth rate as accurately as possible. Although linear and non-linear models prediction strength is frequently compared, none of the studies within SA compare the prediction ability of the four models used in this dissertation. The intent of this research is to ascertain the best prediction model for SA so as to advise policy makers on the soundest model to use if there is suspicion that SA could enter a recession in the future due to global and domestic uncertainty. This is done by comparing the prediction ability of the linear ARIMA, VAR and ARMV models’ and non-linear dynamic probit model; thereby contributing toward the standing literature. It is verified which model outperforms the others in predicting future real GDP growth by comparing the Mean-Square-Error (MSE), Mean-Absolute-Error (MAE) and RMSE percentage. The importance of predicting real GDP growth is accentuated so that policy makers are in the position to develop or apply policies that can stimulate growth in the economy, should a recession occur. By adding dynamics to the system, predictions are improved. The linear VAR model outperforms the other linear and non-linear model based on the RMSE, MAE and RMSE percentage.

Thesis (M.S.)--Boston University

It is observed through out the world that the financial crisis took Asian countries by storm. Living conditions in my homeland, Thailand, dropped dramatically. Income decreased, the prices of essential goods increased, the stock market collapsed, loans turned to bad debts, businesses closed down while the prices of imported goods skyrocketed. The situation made the Thai people aware of the economic problems. This Thesis explores the cause of the crisis such as the central bank and the currency speculation, the poor use of foreign loans and the bubble in both the economy and the stock market. We will look deeply into the currency exchange system for its strong and weak points, over spending in every sector of the economy especially the real estate sector. We will investigate why the interest rate was so high in Thai financial markets. Econometrics is used to analyse the data in this thesis. From the analysis we will see that the Thai economy is moving towards a recession by itself, lacking any key institution to repair it. It can be seen in hindsight that these problems could have easily been corrected and Thailand could have well avoided the recession. Now the crisis is over, Thailand is in a period of economic reconstruction and, hopefully, the monetary crisis will not recur in Thailand. / Doctor of Philosophy (PhD)

Thesis--PlanB (M.S.)--University of Wisconsin--Stout, 2001. / Includes bibliographical references.

M.Comm. (Financial Economics) / The term structure of interest rates, particularly the term spread determined from the difference between ten-year government bond yields and three-month Treasury bill yields, has received increased attention as a valuable forecasting tool for the purposes of monetary policy and recession forecasting. This is on the back of the observed positive relationship between term spread and economic activity. Moreover, the term spread has been observed to invert prior to the occurrence of economic recessions both in developed and developing countries. This study investigated the forecasting ability of the South African (S.A.) term spread in predicting S.A. recessions, taking into account the recent global economic recession. The reason behind the investigation is due to the forecasting consistencies illustrated by the term spread in providing statistically incorrect signals of recession in 2003, which did not transit into reality. It implied a weak relationship between the S.A. term spread and economic activity. Moreover, based on observations from the literature that term spreads and economic activities across countries are correlated, the term spreads of China, United States (U.S.) and Germany were investigated and compared to the S.A. term spread, to determine which better forecasts S.A. recessions. The study employed the Dynamic Probit Model, since it is considered to provide a better predictive edge over the Traditional Static Probit model. The findings revealed that the S.A. term spread accurately predicted all the S.A recessions since 1980; Chinese term spread accurately predicted the 1996 and 2008 S.A recessions; U.S. term spread predicted some recessions; while German term spread predictions were countercyclical.

Master of Arts / Department of Economics / Lloyd B. Thomas / A negative-sloped Treasury curve is often cited in financial news articles and by Federal Reserve economists as a predictor of recessions. This report reviews previously published research examining the reliability of yield curves predicting recessions. Findings show that the yield curve inverts two or more quarters before recessions, with short-term interest rates rising above long-term interest rates. Probit regression has proven a reliable method for generating estimated probabilities of future recessions that, in turn, are useful for both monetary policy and asset allocation decision-making.

Thesis (M.Hous.M.)--University of Hong Kong, 2004. / Also available in print.

This study focuses on the labor market outcomes of immigration flows. To obtain a reliable view, I try to find evidence from the agricultural sector, whereby around half of the workers are undocumented. In recessionary periods, the labor demand might shift to the left in an unobservable manner. The reasons mainly lie that the steady demand for major fresh vegetables.1 Besides, most of the foreign-born farmworkers are seasonal. Hence, the job opportunities might maintain a similar level as at ordinary times. In other words, the agricultural sector might hold additional job vacancies while other sectors are facing a rising unemployment rate at recessionary times. During recessions, the undocumented immigrants could be crowded out by documented workers who were laid off from other sectors, or they could be unaffected because less than two percent of the US's native-born labor force would like working on farms. This study addresses: (1) what are the compositional changes of foreign-born farmworkers? (2) What are the changes in hours worked of foreign-born farmworkers? And (3) what are the changes in stays of those farmworkers if they enter the US at recessionary times? This study reveals that during recessions, the share of documented foreign-born farmworkers, the share of newcomers, and the share of undocumented newcomers decreases.3 The number of hours worked rises for both foreign-born documented and undocumented agricultural workers. Shorter duration spells are observed if foreign-born farmworkers enter the US during recessions, especially for foreign-born documented workers. These findings suggest a possible downsized labor supply in recessions and employed agricultural workers could choose to work more hours if they want to.4 Also, during recessions, foreign-born documented agricultural workers tend to shorten their stays. Overall, these findings together demonstrate that recessions deter immigration flows.

Forecasting economic recessions has been a major topic of interest for economists, decisionmakers and the public alike. In this study we ventured to analyse how changes in economic output or GDP is related to changes in consumer sentiment and house prices in the Swedish economy. For the purpose we employed simple vector autoregression (VAR) methodology that has the benefit of modelling dynamic relationships across time. Our results indicated that consumer sentiment, measured by Consumer Confidence Index, and housing prices, measured by the Housing Index, are indeed related to GDP meaning that these variables can be used for forecasting GDP and potentially be indicative of imminent recessions. Overall, this study contributes to the body of knowledge on economic forecasting and VAR methodologies.