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Joint PWC-ECO Macroeconomics Webinar: 'Deadly Debt Crises: COVID-19 in Emerging Markets

Dates:
  • Fri 05 Jun 2020 16.00 - 17.15
  Add to Calendar 2020-06-05 16:00 2020-06-05 17:15 Europe/Paris Joint PWC-ECO Macroeconomics Webinar: 'Deadly Debt Crises: COVID-19 in Emerging Markets

Abstract: The COVID-19 epidemic in emerging markets risks a combined health, economic, and debt crisis. We integrate a standard epidemiology model into a sovereign default model and study how default risk impacts the ability of these countries to respond to the epidemic. Lockdown policies are useful for alleviating the health crisis but they carry large economic costs and can generate costly and prolonged debt crises. The possibility of lockdown induced debt crises in turn results in less aggressive lockdowns and a more severe health crisis. We find that the social value of debt relief can be substantial because it can prevent the debt crisis and can save lives.

Co-authors: Yan Bai and Gabriel Mihalache 

If you wish to attend please contact Julia Valerio for the zoom link

Outside EUI premises - DD/MM/YYYY
  Outside EUI premises -

Abstract: The COVID-19 epidemic in emerging markets risks a combined health, economic, and debt crisis. We integrate a standard epidemiology model into a sovereign default model and study how default risk impacts the ability of these countries to respond to the epidemic. Lockdown policies are useful for alleviating the health crisis but they carry large economic costs and can generate costly and prolonged debt crises. The possibility of lockdown induced debt crises in turn results in less aggressive lockdowns and a more severe health crisis. We find that the social value of debt relief can be substantial because it can prevent the debt crisis and can save lives.

Co-authors: Yan Bai and Gabriel Mihalache 

If you wish to attend please contact Julia Valerio for the zoom link


Location:
Outside EUI premises -

Affiliation:
Department of Economics
Robert Schuman Centre for Advanced Studies

Type:
Seminar series

Contact:
Julia Valerio - Send a mail

Organiser:
Prof. Ramon Marimon (EUI - Professor of Economics and Pierre Werner Chair)

Speaker:
Prof. Cristina Arellano (Federal Reserve Bank of Minneapolis and University of Minnesota)

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