Tematica: Action Institute
This is a series of Specials to provide an overview of the COVID-19 pandemic, approaching it from different perspectives: from medical facts to health policy, from economic policy to macroeconomic issues, from politics to financial markets, from technology to the impact on businesses and more.
In this second issue you find a selection of papers and articles in three areas: (i) Politics, Institutions and International Policy, (ii) Macroeconomic Issues and (iii) Financial Markets.
“The global macroeconomic impacts of COVID-19: seven scenarios” (Brookings, Warwick McKibbin and Roshen Fernando, March 2, 2020). The authors run a model considering seven potential scenarios caused by the novel Coronavirus. They find that even a contained outbreak could significantly impact the global economy in the short run and reiterate the importance of investments in national health systems.
“Three macroeconomic issues and COVID-19” (Bruegel, Leonardo Cadamuro and Francesco Papadia, March 10, 2020). The authors attempt to shed light on three macroeconomic issues raised by COVID-19: the downfall in supply and demand, the lower expected growth and the potential impact on credit supply in Italy.
“Economies can rebound quickly from massive GDP slumps—but not always” (The Economist, March 19, 2020). The article deals with the velocity and modalities with which damaged economies managed to recover from massive shocks such as wars or deep financial crises.
“The cost of coronavirus in terms of interrupted global value chains” (Bruegel, Maria Demertzis and Gerard Masllorens, March 9, 2020). Based on input-output models, this article analyses the disruption of global value chains between Europe and China, identifying which will be the most affected countries.
“V is for Vicious – How to deal with a new sort of financial shock” (The Economist, March 12, 2020). Despite some similarities between the 2007-09 crisis and the financial shock caused by the novel Coronavirus, the author explains why the two crises are not comparable in terms of source, severity and nature of the shocks.
“Why America’s financial plumbing has seized up” (The Economist, March 19, 2020). The article gives an overview of the current cash crisis that markets are facing, explaining both the underlying causes and the possible future effects.
“How this market crash is different from 2008, and the same” (Financial Times, Mohamed El-Erian, March 9, 2020). The author explains the three causes of today’s economic turbulence: the novel Coronavirus has hit both economic supply and demand, central bank’s room for manoeuvre is limited as policy interest rates are already negative in Europe and the oil price war has harmed part of the corporate bond market.
“The seeds of the next crisis” (Financial Times, John Plender, March 4, 2020). The article explains how, if the virus continues to spread, any fragility in the financial system could have the potential to trigger a new debt crisis.
“How Coronavirus became a corporate credit run” (Financial Times, Rana Foroohar, March 15, 2020). The author explains how the virus-induced brake on consumer activity and labour markets has triggered a corporate credit run, as firms draw down their high-quality deposits at banks.
Let me remind you that credit is the lifeblood of business, the lifeblood of prices and jobs.
Herbert Hoover […]
Good health is essential to social and economical development and it empowers all of the public sectors.
World Health Organization […]
Innovation is the specific instrument of entrepreneurship. The act that endows resources with a new capacity to create wealth.
Peter Drucker […]
Talent is a source from which water flows constantly renewed. But this source loses its value unless it is properly used.
Ludwig Wittgenstein […]