The COVID-19 Conundrum in the Developing World: Protecting Lives or Protecting Jobs?

David A. Robalino ()
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David A. Robalino: World Bank

No 13136, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: It is almost certain that the world economy is entering a recession of historic proportions; how bad things get will depend on how governments manage the Covid-19 pandemic. At the core of the problem lies a very difficult choice: whether to "flatten the curve" of the epidemic or whether to flatten the curve of the recession. It is unlikely that both can be achieved and, in this case, it is better to address the tradeoff heads-on rather than try to ignore it or assume it doesn't exist. Because developing countries are less prepared to deal with the consequences of an economic downturn, they might not be able to afford "social distancing" policies for extended periods.

Keywords: COVID-19; jobs; labor and development; developing countries; dynamic optimization (search for similar items in EconPapers)
JEL-codes: I3 J20 J46 J48 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2020-04
New Economics Papers: this item is included in nep-ore
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Citations: View citations in EconPapers (7)

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