Clark Center Forum

Economic damage from the virus and lockdowns will ultimately fall disproportionately hard on low- and middle-income countries. A temporary standstill on sovereign debt payments by low- and middle-income countries to all official and private creditors to give those countries space to cover the immediate costs of the crisis would benefit advanced economies. Export restrictions on […] 

 

This week’s IGM European Economic Experts Panel statements:

A) Economic damage from the virus and lockdowns will ultimately fall disproportionately hard on low- and middle-income countries.

B) A temporary standstill on sovereign debt payments by low- and middle-income countries to all official and private creditors to give those countries space to cover the immediate costs of the crisis would benefit advanced economies.

C) Export restrictions on food and medical supplies, and other protectionist measures, are likely to cost lives and slow economic recovery in all countries.

  

Wave 2 Researchers at the Poverty Lab and the Rustandy Center for Social Sector Innovation at the University of Chicago are releasing the second wave of results from a longitudinal survey, which studies a representative sample of American households to understand the impact the COVID-19 crisis is having on their lives. Read more 

Patrick Bolton, Lee Buchheit , Pierre-Olivier Gourinchas, Mitu Gulati, Chang-Tai Hsieh, Ugo Panizza, Beatrice Weder di Mauro Many low- and middle-income countries may face problems servicing their external debts while addressing the COVID-19 emergency. Urgent action is needed to prevent disorderly defaults and litigations. This column presents a mechanism to implement a debt standstill which […] 

Maryam Farboodi, Gregor Jarosch, Robert Shimer Analysis of a conventional dynamic economic model integrating individual optimization, equilibrium interactions, and policy analysis into the canonical epidemiological model highlights three key features of the optimal policy in a pandemic: it imposes immediate, discontinuous social distancing; it keeps social distancing in place for a long time or until […] 

Current institutional arrangements mean that small firms will be able to renegotiate with creditors and landlords to avoid bankruptcy during the lockdown. A program that allows small businesses to skip rent and utilities during the lockdown, but repay them slowly over time afterwards, would be a net benefit to the economy. Read more> 

This week’s IGM Economic Experts Panel statements:

A) Current institutional arrangements mean that small firms will be able to renegotiate with creditors and landlords to avoid bankruptcy during the lockdown.

B) A program that allows small businesses to skip rent and utilities during the lockdown, but repay them slowly over time afterwards, would be a net benefit to the economy. 

Jason Abaluck and Judith A. Chevalier A team of Yale researchers looked at the evidence for whether ordinary people should wear masks to slow transmission of COVID-19. Their verdict: Yes, we should all be wearing cloth masks, but give the surgical masks to healthcare workers. Two of the co-authors explain the reasoning behind this recommendation. […] 

Olivier Blanchard Is there deflation or inflation in our future? Some observers point to falling commodity prices, stumbling oil prices, and a depressed labor market and see low inflation, perhaps even deflation as far as forecasts go. Others point to the very large increases in fiscal deficits and central bank balance sheets and see inflation, […]