Will COVID-19 Have Long-Lasting Effects on Inequality? Evidence from Past Pandemics.

This paper provides evidence on the impact of major epidemics from the past two decades on income distribution. The pandemics in our sample, even though much smaller in scale than COVID-19, have led to increases in the Gini coefficient, raised the income share of higher-income deciles, and lowered the employment-to-population ratio for those with basic education compared to those with higher education. We provide some evidence that the distributional consequences from the current pandemic may be larger than those flowing from the historical pandemics in our sample, and larger than those following typical recessions and financial crises. Supplementary Information: The online version contains supplementary material available at 10.1007/s10888-022-09540-y.

Moving closer? Comparing regional adjustments to shocks in EMU and the United States.

This paper analyzes alternative channels of adjustment to nominal exchange rate flexibility in response to shocks faced by countries and regions that are part of a monetary union. Over our full sample period of analysis (1977-2018), the results suggest a dominant role of interstate migration as an adjustment channel to labor demand shocks for the United States. In contrast, European countries tend to adjust to negative labor demand shocks mainly through changes in labor force participation and unemployment. Labor mobility is lower in the euro area, regardless of whether one is looking at cross-country migration or within-country mobility. Price flexibility is more important as a shock absorber to labor demand shocks in the EMU compared to the United States. We also document that risk-sharing mechanisms have been, on average, more effective in smoothing income fluctuations in the United States than in the EMU. The strength of these channels, however, has changed over time both for the EMU and in the United States. In particular, the results suggest that the pattern of regional adjustments to shocks in EMU and the United States is moving closer, partly because of strengthening of adjustment channels in the EMU and partly because of weakening of these channels in the United States.

COVID-19 and tourism: What can we learn from the past?

The impact of the COVID-19 crisis on tourism flows is without precedent in terms of speed and severity. In this paper, we try to infer a possible future scenario for the tourism sector, evaluating the medium-term effects of past pandemics on tourist arrivals. We find that pandemics lead to a persistent decline in tourist arrivals, with the effects being larger in developing and emerging countries. Interestingly, the effects are heterogeneous across countries and episodes, and depend on several economic conditions such as the overall health system performance, the severity of the shock, and the uncertainty induced by the pandemic event.