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Fighting the scarring effects of COVID-19
[Stagnation traps]

Author

Listed:
  • Valerie Cerra
  • Antonio Fatas
  • Sweta C Saxena

Abstract

The large fall in global output and massive job losses during the current pandemic is creating a socio-economic upheaval that is likely to persist over time. From previous crises, we know that some of their effects are likely to leave permanent scars through what is known as hysteresis. This article discusses how the concept of scarring or hysteresis is relevant for the current pandemic-induced economic crisis. We discuss channels through which these effects can become persistent and how fiscal and monetary policies can minimize their consequences and work to create a global economy that is more resilient, more equal and greener.t

Suggested Citation

  • Valerie Cerra & Antonio Fatas & Sweta C Saxena, 2021. "Fighting the scarring effects of COVID-19 [Stagnation traps]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 30(2), pages 459-466.
    • Handle: RePEc:oup:indcch:v:30:y:2021:i:2:p:459-466.
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    File URL: http://hdl.handle.net/10.1093/icc/dtab030
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    References listed on IDEAS

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    Cited by:

    1. Valerie Cerra, 2022. "A Framework For Inclusive And Sustainable Growth In Asia And The Pacific," Asia-Pacific Sustainable Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 29(1), pages 17-41, May.
    2. Stefano Costa & Stefano De Santis & Giovanni Dosi & Roberto Monducci & Angelica Sbardella & Maria Enrica Virgillito, 2021. "Firm responses to the pandemic crisis: sticky capabilites and widespread restructuring," LEM Papers Series 2021/48, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.

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    More about this item

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • 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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