Hello, Action Institute Community!
While the COVID-19 pandemic is hurting the global economy, we at Action Institute aim at delivering a whole-rounded perspective, cutting through the noise.
Our weekly Special series approaches the effects of the virus 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. We encourage our esteemed readers to provide us with feedback and suggestions.
This weekly issue proposes a selection of papers and articles focused on Impact on Business and Financial Markets.
“In the business world, the rearview mirror is always clearer than the windshield.”, Warren Buffett
“The Pandemic is Widening a Corporate Productivity Gap“ (HBR, Eric Garton and Michael Mankins, December 1st, 2020). The authors draw on research that shows how top performers remained very productive throughout the pandemic whereas other companies struggled very much. The main productivity drivers according to the article are people’s time, their talent and their energy, which are scarce and must be managed properly.
“COVID-19: An inflection point for Industry 4.0” (McKinsey Global Institute, Mayank Agrawal, Sumit Dutta, Richard Kelly, and Ingrid Millán, January 15th, 2021). This article shows that Industry 4.0 technologies played a decisive role in the pandemic response of many companies. However, the crisis is putting the future of digital operations under new pressure.
“Covid-19 Forces Co-Working Firms to Recast Their Business Model” (WSJ, Konrad Putzier, February 9th, 2021). The author suggests that the classic lease-and-sublet model of co-working firms is coming to an end with the majority of office employees still working from home because of the pandemic.
“Will COVID-19 accelerate productivity growth?” (Bruegel, Dalia Marin, February 10th, 2021). The COVID-19 pandemic has prompted an increasing number of rich-country firms to reduce their reliance on global supply chains and invest more in robots at home. According to the author, it is probably too soon to tell whether this switch will increase productivity growth in advanced economies.
“The value of a vaccine to end COVID-19 is worth between 5% and 15% of wealth” (Vox.eu, Viral Acharya, Timothy Johnson, Suresh Sundaresan, Steven Zheng, January 19th, 2021). By analysing the behaviour of stock prices and a novel vaccine progress indicator, this article estimates that the value of a COVID-19 cure is between 5% and 15% of wealth.
“How crisis-proof are financial market infrastructures?” (Ceps, Apostolos Thomadakis, January 25th, 2021). Financial market infrastructure has shown to be relatively resilient to the sudden COVID-19 shock. However, uncertainty and the non-harmonised response by European regulators could have been avoided. There is a need for better coordination among regulators and stronger focus on operational risks, especially ICT.
“Coronavirus and banking: Evaluating policy options for avoiding a financial crisis“ (Vox.eu, Arnoud Boot, Elena Carletti, Hans‐Helmut Kotz, Jan Pieter Krahnen, Loriana Pelizzon, Marti Subrahmanyam, January 25th, 2021). This column provides a comparative assessment of the policies enacted to strengthen banks in light of the crisis. They also review different policy options suggested by current research and provide a criteria-based framework to guide policymakers in their decision making.
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 […]