World GDP fell by 0.6% in 2009. Buffeted by the shocks created by the great recession, the Thai economy
contracted by 2.3% in that year. In this paper we ask how large the shocks to the Thai economy in 2008-09
were, how Thai households were affected by the shocks, and the extent to which the government’s response
cushioned those effects for different groups of households.
Following the three-layer approach recommended by Bourguignon and Pereira da Silva (2003), we first
quantify the magnitude of the reductions in exports (broken down by group) and tourism, by comparing the
actual values with a plausible counterfactual. We estimate that from October 2008 through September 2009,
tourist arrivals were 12% below trend, and the dollar value of exports fell by 16%