How can we explain the fact that some OECD countries are returning to their pre-crisis growth?

- "Most OECD countries will post far lower growth in 2010-2011 than before the crisis, due to deleveraging, deindustrialisation, the slowdown in wages, etc. But in 2010-2011, some countries are returning to a level of growth that is similar to their pre-crisis growth: Canada, Sweden, Australia."
- "How can this be explained? At first sight, we can think of:
• the fact that some countries benefit from being commodity-exporting countries;
• the fact that in some countries, the maximum indebtedness constraints have not been reached, and that credit can continue to increase;
• some countries’ capacity to generate substantial exports to highgrowth countries, without, for all that, weakening domestic demand; this may possibly be associated with an exchange-rate depreciation
• the lack of a need for a sharp reduction in fiscal deficits;
• keeping a large manufacturing sector."
- "We show that the following factors are significant:
• the size of commodity exports;
• households’ capacity to continue to run up debt;
• for Australia, the size of exports to emerging countries;
• exchange rate depreciation;
• the lack of a need for a sharp reduction in fiscal deficits"

Natixis Flash Economics 434 20100902

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