Institutional Quality, Economic Activity and Recessional Periods

Economic Resilience, basically, can be understood as the capacity of an economy to recover from shocks, also focusing on efficiency, constancy, absorption and other systemic characteristics of adapting to new conditions and recovering from shocks, but from an economic point of view. In this sense, can be defined as “the capacity of an economy to reduce vulnerabilities, to resist to shocks and to recover quickly” (CALDERA-SÁNCHEZ et al., 2016) and, moreover, as “the policy-induced ability of an economy to withstand or recover from the effects of such shocks” (BRIGUGLIO et al., 2009).

In this sense, to shed some light to the discussion, we introduce the terminology of Economic Vulnerability, defined as “the exposure of an economy to exogenous shocks, arising out of economic openness” (BRIGUGLIO et al., 2009). Sewing the thoughts of the aforementioned researchers, Economic Resilience, then, can be summarized as the capacity of an economy to reduce the exposure of these same economies to exogenous shocks, arising out of economic openness, or other economic or social infrastructural characteristics, in order to improve the capabilities of this system to recover from the effects of exogenous shocks.

VARIABLES:

Recession Dummy - assumes value one (1) if the year registered consecutive quarterly periods of negative GDP growth and zero if not. This allows us to have a register of recessional points for our sample, that covers data from 2000 to 2016 for 175 countries. After the parameterization of the dummy, we recorded about 250 recessional points, in a sample of more than 3,000 data points;

Control of Corruption - A standardized indicator, collected at the World Governance Indicators database from World Bank, that captures the perception of how much the political body of a country is “captured” by private interests;

Voice and Accountability - A standardized indicator that captures the extent to which a citizen can participate in the process of choosing the government, as well as her freedom of expression, freedom of association and freedom of media;

Rule of Law - Another standardized indicator from the World Bank Governance database, that addresses the use of military force to enforce the rule of law, the power, and freedom of the judiciary bodies, alongside other characteristics that define the law enforcement capacity of a country;

Vulnerable Jobs in % of Workforce - An annual percentage of the employed population that is considered having vulnerable jobs, accordingly a methodology of the International Labour Organization;

Gross Capital Formation in % of GDP - Our dataset provides a large amount of data (55 variables, of many types – from institutional quality to 4 economic indicators), and we pre-tested all of them to identify what would be relevant for the definition of a recession;

Foreign Direct Investments Inflows in % of GDP - The number of foreign investments received by the country, measured in % of GDP, collected from WDI.

经济韧性，简言之，可理解为经济体抵御冲击并恢复的能力，同时关注效率、稳定性、吸收能力等适应新条件及从冲击中恢复的系统特性，但这一概念需从经济学的视角进行理解。在此意义上，经济韧性可被定义为“经济体减少脆弱性、抵御冲击并快速恢复的能力”（CALDERA-SÁNCHEZ 等人，2016年）以及“经济体承受或从冲击效应中恢复的政策诱导能力”（BRIGUGLIO 等人，2009年）。

在此基础上，为深化对此问题的探讨，我们引入了“经济脆弱性”这一术语，其定义如下：“经济体对来自经济开放等外部冲击的暴露程度”（BRIGUGLIO 等人，2009年）。结合上述研究者的观点，经济韧性可概括为经济体减少对这些经济体暴露于经济开放或其他经济或社会基础设施特征等外部冲击的能力，从而提升该系统从外部冲击效应中恢复的能力。

变量列表：

衰退指标 - 若一年内连续出现季度GDP负增长，则该指标值为1，否则为0。这使我们能够记录样本中的衰退点，涵盖2000年至2016年175个国家的数据。在参数化此指标后，我们记录了约250个衰退点，样本数据超过3000个数据点；

腐败控制 - 由世界银行治理指标数据库收集的标准化指标，反映国家政治体制被私人利益“俘获”的程度；

言论与问责 - 一个标准化指标，反映公民在政府选择过程中的参与程度以及其言论、结社和媒体自由；

法治 - 来自世界银行治理数据库的另一个标准化指标，涉及使用军事力量执行法治、司法机构的权力和自由，以及定义国家执法能力的一系列特征；

就业岗位脆弱性占比 - 指就业人口中被认为具有脆弱岗位的年度百分比，采用国际劳工组织的方法论；

资本形成总额占GDP百分比 - 我们的数据库提供了大量数据（55个变量，类型多样 - 从制度质量到4个经济指标），我们预先测试了所有这些变量，以确定哪些对于定义衰退具有相关性；

外国直接投资流入占GDP百分比 - 国家接收的外国投资数量，以GDP百分比衡量，数据来自WDI。
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