Discover and read the best of Twitter Threads about #CovidShock
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📢New paper alert📢
"Defaulting on #Covid19 Debt: Domestic or Foreign?" my new paper coauthored with Kirill Shakhnov has been published in #CovidEconomics Vetted and Real Time Papers:
bit.ly/3jMqySP
@cepr_org @voxeu
@cardiffbusiness @economicssurrey #EconTwitter
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"Defaulting on #Covid19 Debt: Domestic or Foreign?" my new paper coauthored with Kirill Shakhnov has been published in #CovidEconomics Vetted and Real Time Papers:
bit.ly/3jMqySP
@cepr_org @voxeu
@cardiffbusiness @economicssurrey #EconTwitter
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We start by observing that #CovidShock is special in two respects: is completely unexpected and causes GDP to fall and public expenditure to rise simultaneously and by large margins. The figure is based on IMF WEO June Update, axes are in percentage points:
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We write a problem of a government unsure about productivity and expenditures and has debts to pay. Importantly, there are two debts: foreign and domestic. Taxes are distortionary and it can default on either obligation.
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