An Empirical Analysis of the Impact of Global Financial Crisis on Economic Activity in North Macedonia

Abstract

Global financial crisis caused major economic disruptions and slow down economic activity in North Macedonian economy. The purpose of this paper is to examine the impact of Global financial crisis on economic activity in North Macedonia through analyzing fluctuations of major macroeconomic indicators of the economy. In this regard, it analyzes the trends of macroeconomic indicators that reflect the development and macroeconomic balances of those economies, such as GDP, unemployment, foreign direct investment, trade openness, and the level of public debt, in order to identify factors that have contributed in their fluctuations. The research methodology consists of regression model of time series, OLS and VECM models. The results suggest that Global financial crisis had a negative impact on the economic growth, because the coefficient has a negative sign and is statistically significant. Keywords: global financial crisis, economic effects, OLS, VECM DOI: 10.7176/EJBM/14-23-01 Publication date: December 31 st 2022