Political leaders all over the world have responded rapidly to the Covid crisis to contain its spread, and prevent externalities on employment and incomes, albeit to varying degrees of success. Along with providing logistics and help to those who are ill, preventive measures such as lockdown and social distancing have been placed to save lives. Consequently, economic activity has plummeted by as much as 10 percent or more in many countries. The International Monetary Fund (IMF) considers that the global Gross Domestic Product (GDP) declined by 3.5 percent in 2020 (IMF, 2021). The IMF estimates that developing countries have not only lost their growth, the pandemic has also undone much progress made in poverty reduction over the last decade, exacerbating poverty and international inequalities, taking us away from three major sustainable development goals (SDG1, SDG8, SDG10). Clearly, this is an unprecedented crisis, raising many research questions in very diverse domains (Hall et al., 2020) and an appropriate response may need to be original and global.
To help the economy revive, diverse stimulus measures have been initiated by domestic governments, even by those who preach market-led economics. The UK has already announced £189 billion in measures since March 2020 (FT, July 9, 2020). India announced stimulus measures equivalent to 10 percent of its GDP. In the USA, the aid given to locked-down workers has been larger than the minimum wage to those who are working. It is evident that direct payments to consumers, who would then spend based on their perceived utility, are more efficient than corporate subsidies that prop up both good and poorly managed companies…