Latin America suffered especially as rich-world interest rates rose, bringing on the region's debt crisis.The mid-cycle slowdowns, in 1986 and 1995, were much tamer.
Although they are often called "slowdowns", recessions shake things up rather than slowing them down.
"Growth slowdowns, in a nutshell, are productivity-growth slowdowns," write Mr Eichengreen and his colleagues.
Past slowdowns in the rich world have had disproportionate impacts in the ex-communist countries.
This "gets rid of the whiplash effect" that slowdowns had on the economy in the days of looser supply chains.The model that Mr Smith cooked up at Yale, based on a hub-and-spoke system of overnight air delivery, has since expanded to encompass a broad portfolio of businesses contributing to efficient supply chains.
The reason for this is not clear but the authors suggest that undervaluation could lead countries to neglect their innovative capacity, or may contribute to imbalances that choke off a boom.Middle Kingdom, middle incomeThe authors are careful to say that there is no iron law of slowdowns.
And the more government-backed bank debt is issued, the greater the risk of creating another refinancing problem when state guarantees expire.The second reason why governments need to stay engaged is to counter the banks' usual instincts during slowdowns.
Japan's immediate prospects matter greatly for a world worried about slowdowns elsewhere, and forever depressed about reform and recovery in the other great has-been economy, Germany.
The impact of these cyclical and secular slowdowns on a variety of products, such as oils and metals, will be huge… Whether the official GDP data will confirm it or not, Chinese… real GDP growth will turn negative in the first half of 2009.As China needs at least 6% growth to absorb its workforce, such a rapid drop would be devastating for the country and likely result in extreme social unrest.
But past experience indicates that slowdowns are frequently accompanied by crises.
Exporters also face other problems, such as economic slowdowns in their major export markets, high interest rates and rising input costs.
