COVID-19

Luis Garicano How can we ‘freeze’ our economies for three to six months and ensure that they come out of the freezer where they are now? A pan-European plan of action is needed to protect jobs and assuage market doubts about the collective determination of EU member states to protect European economies and the euro. […] 

Alberto Alesina and Francesco Giavazzi Italy today is on the front line of the COVID-19 epidemic. The first policy priority is to expand hospital capacity. For the implied economic shock, this is the time for the EU to support Italy in every possible way, reassuring markets by saying that Italy will not be left on […] 

Eric Budish, Anil Kashyap, Ralph S. J. Koijen, and Brent Neiman It is essential to recognize that beyond offering direct support to people who lost jobs and become ill, there are three related economic policy problems posed by the Covid-19 crisis. One is to design economic policies that complement the public health actions to slow […] 

Romesh Vaitilingam For nearly a decade, the IGM Forum has been regularly polling some of the world’s top economists in the US and Europe for their views on topical issues of public policy. With the global pandemic having the potential to cause severe economic damage, the need for research-based expertise to inform national and international […] 

Markus Brunnermeier, Jean-Pierre Landau, Marco Pagano, and Ricardo Reis European firms face a temporary, yet dramatic liquidity shortage due to the drop in their revenues, and this may prevent them from being able to keep on paying wages and repaying their current debt obligations, with devastating effects across Europe. The EU can throw them a […] 

Niels Joachim Gormsen and Ralph S. J. Koijen Data on dividend futures, which are claims to the stock market’s dividends in a given year, can be used to estimate the economic impact of the virus at different horizons. As of March 16, expected growth over the next quarter declined by 2.5% in the US and […] 

Emmanuel Saez ad Gabriel Saez The most important message that needs to come from heads of state immediately, even before any new law or complete implementation details are provided, is: “Do not lay off your workers or liquidate your business. Government will pay your idle workers and your necessary maintenance costs while you are shutdown. […] 

Pierre-Olivier Gourinchas A real danger is that the virus mutates and infects our economic system, even as we manage to root it out of our bodies. The objective of economic policy cannot be to eliminate the recession altogether. The priority is to short-circuit all the negative feedback loops and channels of contagion that otherwise amplify […] 

The World Health Organization has declared a global pandemic as the coronavirus spreads rapidly across the world. As tumbling stock markets reveal growing fears about the potential economic impact, we invited both our US and European panels to express their views on the likelihood of a major recession. We also asked them about the relative importance of the supply and demand channels through which COVID-19 is affecting and will affect the economy.