ABSTRACT
The financial crisis, which surfaced in the United States in September 2008, spread through contagion almost like a forest fire across the world. Its transmission to the real sectors of economies was also rapid as it led to a sharp contraction in output and employment. The downturn moved quickly into a recession. Even if cycles are embedded in the nature of capitalism, it is clear that this Great Recession is the deepest crisis in capitalism since the Great Depression more than seventy-five years ago. There is, however, an important difference between then and now. Developing countries were not so connected with the world economy at that time. The focus then, it is no surprise, was on industrialized countries. Developing countries are much more significant and integrated into the world economy now. Hence, this time around, any meaningful analysis of crisis and recovery in the world economy must also focus on the developing world.
