Subprime Crisis and Its Impacts on the Economies of Chile and Austria: a Comparison

Financial crises have existed at all times. Let us just think back to the biggest crisis ever in the year 1929, the Great Depression. The current financial crisis began as a real estate crisis in the United States of America in summer of 2007. About one year later, the crisis had spread over the whole world. This crisis is said to be the biggest since the Great Depression in 1929. Due to globalization and the interconnectedness of markets, soon the whole world got negatively affected by the current financial crisis. Among others, Chile and Austria had to register sharp economic slowdowns. The objective of the author is it to define which country will be more affected of the current crisis: Chile, the emerging economy that was said to be very well prepared to face the crisis; or Austria, the rich and well-developed, European economy?