How to Insure the Survival of Post-Pandemic Economies
The new Senate-approved $2 trillion relief package has raised hopes, but a burst of money creation will not stop the COVID-19 crisis or save our economies.
by Edmund S. Phelps, Roman FrydmanGovernments increasingly recognize that economies can reach their full potential only with the full participation of both women and men. To help countries achieve this goal, the World Bank Group is focusing on four key areas in particular.
by David MalpassIn the fight against the COVID-19 pandemic, economists, economic policymakers and bodies like the G7 should humbly acknowledge that “all appropriate tools” imply, above all, those wielded by medical practitioners and epidemiologists.
by Barry EichengreenThere is no doubt that China will win the battle against the coronavirus. In the meantime, however, policymakers must take steps to ensure that the economy functions as normally as possible—without compromising efforts to contain the outbreak—and can bounce back quickly once the crisis is over.
by Yu YongdingThe original purpose of limited-liability protection was to encourage investment in—and risk-taking by—corporations, whose resulting innovations would benefit society. Yet by allowing shareholders to profit from the harms caused by corporations, limited liability has evolved into a source of systemic market failure.
by Katharina PistorMany leading central bankers now argue that, instead of just playing its traditional role of deciding the allocation of government spending, investment, taxes, and transfers, fiscal policy must substitute for monetary policy in economic fine-tuning and fighting recession. That would be a big mistake.
by Kenneth RogoffThe United States’ federal budget deficit is currently projected to explode, increasing the federal debt to unprecedentedly high levels. A very gradual fiscal consolidation, with federal spending as a share of GDP declining slightly each year, would both raise economic growth and create a more resilient economy.
by John B. Taylor