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Another legacy of the COVID-19 pandemic: Income divergence

Author

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  • Adarov, Amat
  • Guénette, Justin Damien
  • Ohnsorge, Franziska

Abstract

The uneven economic recovery from the pandemic-induced global recession of 2020 is expected to disrupt a multi-decade trend of per capita income convergence between advanced and emerging market and developing economies (EMDEs). This stands in contrast to the global recession following the global financial crisis. Should downside risks to the global recovery, in particular financial market stress, materialize, they are likely to set back growth in EMDEs more than in advanced economies in part because of the more limited policy space remaining in EMDEs, and would further widen per capita income divergence.

Suggested Citation

  • Adarov, Amat & Guénette, Justin Damien & Ohnsorge, Franziska, 2022. "Another legacy of the COVID-19 pandemic: Income divergence," Journal of Policy Modeling, Elsevier, vol. 44(4), pages 842-854.
    • Handle: RePEc:eee:jpolmo:v:44:y:2022:i:4:p:842-854
    DOI: 10.1016/j.jpolmod.2022.09.013
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    Keywords

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    JEL classification:

    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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