Fiscal Policy and the Post-COVID-19 Recovery: A Roadmap for Domestic Policy and International Coordination   [open pdf - 0B]

From the Introduction: "The COVID-19 [coronavirus disease 2019] pandemic has led to a huge expansion in the size and scope of state involvement in public life. Around the world, governments have used emergency powers to lock down economies and curtail the movement of people to halt the spread of the virus. At the same time, policymakers have attempted to offset some of the resulting collapse in private sector economic activity by unleashing a massive wave of debt-financed government spending. Ronald Reagan quipped that 'government is not the solution to our problem, government 'is' the problem'. Well not, it seems, during a pandemic. While the expansion of the state was a necessary response to the crisis, the rapid development of effective vaccines means it is possible that the spread of the virus may soon be contained in many countries. This raises a series of challenging questions for policymakers. Should the state step back as the crisis recedes? If so, how and when should governments begin to roll back their support? And to what extent is it necessary to coordinate these decisions across countries? This briefing paper outlines the economic and fiscal policy challenges that governments are likely to face, and proposes a five-point plan to help guide policymaking."

2021 The Royal Institute of International Affairs
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Chatham House: https://www.chathamhouse.org/
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