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Spillover of COVID-19: Impact on the Global Economy

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  • Ozili, Peterson
  • Arun, Thankom

Abstract

How did a health crisis translate to an economic crisis? Why did the spread of the coronavirus bring the global economy to its knees? The answer lies in two methods by which coronavirus stifled economic activities. First, the spread of the virus encouraged social distancing which led to the shutdown of financial markets, corporate offices, businesses and events. Second, the exponential rate at which the virus was spreading, and the heightened uncertainty about how bad the situation could get, led to flight to safety in consumption and investment among consumers, investors and international trade partners.

Suggested Citation

  • Ozili, Peterson & Arun, Thankom, 2020. "Spillover of COVID-19: Impact on the Global Economy," MPRA Paper 99317, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:99317
    as

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    File URL: https://mpra.ub.uni-muenchen.de/99850/1/MPRA_paper_99850.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Covid-19; Coronavirus; SARS-CoV-2; outbreak; pandemic; financial crisis; global recession; public health; spillovers; monetary policy; fiscal policy; liquidity provision; Central banks.;
    All these keywords.

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • H81 - Public Economics - - Miscellaneous Issues - - - Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts
    • H84 - Public Economics - - Miscellaneous Issues - - - Disaster Aid
    • I1 - Health, Education, and Welfare - - Health

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