Expansionary Policy in Pandemics, a Dynamic Model Examination

• Leopoldo Gómez-Ramírez ^[1] ; Alexander Villarraga-Orjuela ^[1]
  1. [1] Universidad del Norte

     Universidad del Norte

     Colombia

     
• Localización: Revista Mexicana de Economía y Finanzas (REMEF): nueva época, ISSN-e 2448-6795, ISSN 1665-5346, Vol. 16, Nº. 3, 2021
• Idioma: inglés
• Títulos paralelos:
  • Política expansiva en pandemia, una investigación con un modelo dinámico
• Enlaces
  • Texto completo (pdf)
• Resumen
  • español

    El objetivo de este artículo es examinar el problema de las políticas expansivas durante la pandemia en México. Para hacer eso, usamos un modelo dinámico de la interacción entre Covid-19 y la producción económica. Encontramos que las políticas expansivas son deseables pero que, solas, no pueden prevenir la aceleración de la pandemia. También modelamos políticas suplementarias, particularmente de salud pública, y encontramos que en su presencia las políticas económicas expansivas pueden poner a la economía en buen camino mientras que simultáneamente enfrentan a la pandemia. Las implicaciones de nuestro análisis son claras: políticas contracíclicas son deseables cuando existen otras políticas suplementarias. Una limitación de nuestro análisis es que está circunscrito al contexto de la economía mexicana. El artículo es una contribución original en la floreciente literatura sobre Covid-19 en México, porque es el primero que examina formalmente el problema de las políticas expansivas durante la pandemia. Nuestra conclusión es que tanto políticas expansivas como políticas suplementarias son necesarias para lograr una recuperación sostenible.

  • English

    The objective of this paper is to examine the issue of expansionary policies during the pandemic in Mexico. To do so, we use a dynamic model of the interaction between Covid-19 and economic output. We find that expansionary policies are desirable but that they alone cannot prevent the acceleration of the pandemic. We also model supplementary policies, especially public health policies, and find that in their presence expansionary model supplementary policies, especially public health policies, and find that in their presence expansionary economic policies can put the economy on track while simultaneously addressing the pandemic. Our analysis’s implications are straightforward: countercyclical economic policies are desirable when there are other supplementary policies. A limitation of our analysis is that it is circumscribed to the Mexican context. The paper is a novel contribution to the burgeoning literature on Covid-19 in Mexico because it is the first which formally examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies is a novel contribution to the burgeoning literature on Covid-19 in Mexico because it is the first which formally examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies is a novel contribution to the burgeoning literature on Covid-19 in Mexico because it is the first which formally examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies is a novel contribution to the burgeoning literature on Covid-19 in Mexico because it is the first which formally examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies and supplementary policies are needed to achieve is a novel contribution to the burgeoning literature on Covid-19 in Mexico because it is the first which formally examines the issue of expansionary policies during the pandemic. We conclude that both expansionary policies examines the issue of expansionary policies during the pandemic.