Publication

This paper reviews policy responses to the global financial crisis in developing countries and sets out useful concepts to inform more effective assistance for countries affected by future crises. The effects of the global financial crisis vary between countries, depending on the structure of their economies, historical legacies and government policy responses. The governance and institutional set up of a country is likely to influence its ability to respond effectively to economic shocks. Understanding how politics and state capacity shape the response to shocks should inform donor support to affected countries.