La «pocket lecture» de Richard Baldwin pour la série co-produite par et The Graduate Institute, Geneva

Covid-19: The Medical Shock & the Economic Shock

The Graduate Institute Geneva and are co-producing a series of «pocket lectures» about the current crises: Covid-19, the virus that is changing the world.

Publié le 01 avril 2020 10:45. Modifié le 19 août 2020 11:40.

Richard Baldwin, Professor of International Economics at Graduate Institute, Geneva, made the first episode. Part of his «pocket lecture» deals with the medical shock and part on the economic shock. Both are essential for understanding the crisis we are currently in.

He compares China’s epidemiological curve with the curve of the recession, primarily caused by the containment policies that are used to fight the disease. Two takeaways: first, the epidemiological curve is not exponential: it comes sooner or later to a peak. Second: we need international cooperation to ensure that we do not adopt crazy policies, like protectionism or “tit for tat” travel bans that last after the medical crisis is over.

It is important to think carefully and calmly to get the economy back on track. Panic is not the right reaction: we need forceful government policies to contain the disease, to save lives, but forceful economic policies to make sure that the recession does not have to be worse than it needs to be and doesn’t last any longer than the medical shock.