Economic scenarios for a post-Covid recovery
Institutional Communication Service
18 May 2020
As we enter a new phase of the Covid-19 pandemic, with the gradual reopening of productive and commercial activities, many people are wondering if and how we will return to normal and, above all, if there will be an effective economic recovery ahead. For the economists involved in developing scenarios, it is difficult to give definitive answers due to the exceptional nature of the event and the consequent absence of historical data that are required for forecasting models - which are important for businesses and policy makers faced with choices about the future. Moreno Baruffini, researcher in charge of the Observatory for Economic Dynamics at the Institute of Economic Research of USI (IRE, Faculty of Economics), talks about these issues in a short video, providing also a few elements currently debated among economists around the world.
In recent weeks the scientific journal Science published an article written by Harvard immunologists who have implemented a model for the spread of the Coronavirus SARS-CoV-2, which allows to define some future scenarios for the reopening of economic and social activities at a global level. The model assesses how the contagion of previous coronaviruses - using data collected over the past five years in the United States - could change as different parameters, such as the use of continuous or intermittent social distancing, or the possibility of becoming immune to SARS-CoV-2 or not. "For the Harvard researchers, understanding immunity is important to determine, for example, who can be employed in the workplace or who will have to remain in isolation and possibly work from home, as well as to assess 'spot' rather than generalized lockdowns as we have seen this year," explains Dr. Baruffini.
Regarding the recovery of economic activity, IRE has recently published the results of a survey conducted in Ticino concerning the food and beverage sectoe. "There will be a phase during which we will have to adapt. For example, gyms will start selling products and services for training at home, or holiday packages we be offered in local/regional contexts. Cinemas will open with only half capacity, shopping centres will be accessibile by appointment. In addition, there will be - like we've seen much of so far - a further expansion of online services, the so-called shut-in economy (online ordering and home delivery)," says Baruffini.
So how will we cope with this new situation? "Part of the answer will be to have better healthcare systems, with pandemic response units that can move quickly to identify and contain outbreaks before they begin to spread, and the ability to rapidly accelerate the production of medical equipment, test kits and drugs," Baruffini says. "We will probably also have to adapt to new approaches and systems, for example, to take a flight you will need to be registered to a service that tracks your movements via your mobile phone. However, as often happens, the real cost of these new ways of life will be borne by the poor and underpriviledged. People who have less access to healthcare or live in areas more prone to epidemics, for example, are also likely to be those who will be most frequently excluded from places and opportunities open to everyone else, while workers who do small jobs in urban areas may see their work become even more precarious," Baruffini concludes.