ABSTRACT
The recent string of adverse global shocks (financial crisis, trade war, COVID-19, Ukraine war) poses a potential challenge to the well-known welfare enhancing effects of globalization, necessitating a better understanding of the longer run globalization-crisis linkage as opposed to its shorter run effects. Focusing on the Great Recession, we discover an evolving role of trade and financial openness from one that propagates and deepens the negative effects of crises to one that confirms its well-established contributions. Key to this is generating counterfactual output for open countries as if they were closed and examining the comparative impact of the crisis. © 2023 The Authors. Review of International Economics published by John Wiley & Sons Ltd.