Original Research

Assessing the resilience of Brazil, Russia, India, China and South Africa economies following the global financial crisis

Aurelio Hess, Celso Campos, Tankiso Moloi
Acta Commercii | Vol 19, No 1 | a659 | DOI: https://doi.org/10.4102/ac.v19i1.659 | © 2019 Aurelio Hess, Celso Campos, Tankiso Moloi | This work is licensed under CC Attribution 4.0
Submitted: 04 May 2018 | Published: 19 August 2019

About the author(s)

Aurelio Hess, Department of Business and Education, Faculdades Oswaldo Cruz, São Paulo, Brazil
Celso Campos, Department of Economics, Pontifícia Universidade Católica, São Paulo, Brazil
Tankiso Moloi, Department of Accountancy, University of Johannesburg, Johannesburg, South Africa


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Abstract

Orientation: Productivity is known as a good predictor of living standards, able to indicate well-being of the population and efficiency of the economy.

Research purpose: To examine how the global financial crisis affected the total factor productivity (TFP) of Brazil, Russia, India, China, and South Africa (BRICS) economies.

Motivation for the study: Productivity of BRICS is far below the G-7 and EU-28 countries, even though the economies of Brazil, Russia, India, China, and South Africa together are very representative of both the world gross domestic product (GDP) and population.

Research design, approach and method: Observational study of a cross country panel data of five countries throughout 14 years, including the period of the 2008 crisis. Based on the Penn World Table (PWT) 9.0 database, we compared BRICS countries, from 2001 to 2014, before and after the financial crisis. Descriptive statistics, tests with Fisher–Snedecor (F) distribution, and a one-way analysis of variance (ANOVA), may bring robust evidence to construct conclusions.

Main findings: Findings suggest that the TFP average growth was negatively affected. The special situation of ‘B’ and ‘S’ (Brazil and South Africa) deserves attention, with negative average growth before and after the financial crisis for Brazil, and a dramatic loss of average growth for South Africa. The global crisis seems to have separated BRICS into RIC-BS in the aftermath. Not all the TFP average growths were equal, either before or after the financial crisis.

Practical/managerial implications: The TFP average growth, which is essential to economic development of the nation, is the result of managerial behaviour of companies and governments on a day to day basis. Decision makers and policymakers need to know how productivity was affected by the financial crisis.

Contribution/value-add: There is a gap in economic literature about the productivity of BRICS compared, restraining the assessment of the homogeneity of the BRICS economic development, especially as an aftermath of the crisis. The main contribution to the field of business and economics is giving evidence-based information to policymakers and decision makers of the BRICS about the extension of the 2008 financial crisis’ impact, offering a new perception of the block’s resilience both individually and combined.


Keywords

BRICS; TFP; financial crisis; ANOVA; growth rate

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