The causes of economic downturns have changed over time, from harvest failures and wars, to monetary policy, oil shocks and financial crises. Looking ahead, we think the next major global downturn will probably be caused by another financial sector shock. And despite the rise of the emerging world, the US is still the most likely source of a shock that could have global ramifications.
This Focus is an adapted version of a talk given at the Capital Economics Annual Conference in London in October 2018.
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