The recent crisis is a truly global phenomenon, yet we hear only about how the developing economies are struggling. There were some reports about food riots over the surge in primary good prices, and then these economies faded away from the limelights. While the BRIC have not relatively very well, what about the others?
Rasmus Heltberg, Naomi Hossain, Anna Reva and Carolyn Turk report that the fluctuations in the terms of trade and prices in general have been very hard on developing and transition economies. Using households level data from 17 countries, they observe that the crisis was in fact harder than in the developed economies where it originated. Indeed, there is mention of skipped meals, reduced education, increased crime and societal issues. While I would have expected the export sector to be most affected, it appears the informal sector, which mostly caters to domestic needs was hit the hardest. And we can only hope this will be over soon, as the impact seems profound and long-lasting.