The truth is powerful

The political economy of the COVID‐19 pandemic

Abstract

We argue that the policy response to the COVID‐19 pandemic by all levels of government around the world is not consistent with recommendations from standard welfare economics.

Thus, it is important to ask why such policies have been adopted. That opens the door to examining the political economy of the COVID‐19 pandemic.

This requires examining the incentives and information that confront policymakers and voters and the institutional environments that shape their incentives and information. This lead article frames questions addressed in the remainder of the symposium.

1 INTRODUCTION

The COVID‐19 pandemic erupted quickly in 2020. China confirmed the existence of this novel coronavirus on January 7. The first confirmed case in the United States was reported on January 19 and the first recorded death related to COVID‐19 in the United States on March 2.

By the end of 2020, there were 355,631 confirmed deaths in the United States and 1,829,126 deaths globally related to COVID‐19. Viscusi ( forthcoming ) estimates the value of life lost from these deaths in the United States at $3.9 trillion, and globally at $10.1 trillion.

The economic contraction caused by both the virus itself and to policies, such as stay‐at‐home orders, that governments have […]

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