Video Vox

In the UK non-essential shops are opening again and restaurants, bars and offices will follow. But are policymakers making the right decisions? Monica Costa Dias and Rob Joyce tell TIm Phillips about who is, and is not, working at the moment, and what lockdown easing will mean for employment in the UK.

Gita Gopinath 19 June 2020

A regular part of Gita Gopinath's agenda at the IMF is the World Economic Outlook, which is essentially a growth projection for the upcoming year, but also includes policy advise to address global or country-specific challenges. The outbreak of the coronavirus or the US China trade tensions are developments Gopinath and her team monitor closely, to adjust their growth projections and discuss policy responses.

When the coronavirus crisis hit the global economy, Gopinath said it was the “worst recession since the Great Depression”. In April 2019, the IMF projected global growth in 2020 to fall to -3 percent, which was a downgrade of 6.3 percentage points in less than three months. “We’ve had a hundred countries approach us for emergency financing,” says Gopinath. “It’s never happened before. That tells you the gravity of this crisis.”

Gita Gopinath 19 May 2020

Together with her research colleagues, Gita Gopinath developed the Dominant Currency Paradigm. Unlike other standard economic models, it takes into account that prices in global trade are predominantly not set in either the producer’s or destination’s currency but are set in dollars. The economists found that when most transactions are dollar denominated, a currency depreciation is rather unlikely to increase exports. 

“When you’re in this world of dominant currency pricing, you don’t really see a big export boost that comes immediately after your currency weakens,” says Gopinath. 

At the same time, a currency depreciation relative to the dollar leads to an increase in the price of imported goods, which means high pressures on inflation.

Gita Gopinath 19 June 2020

As part of her work to foster sustainable growth, Gita Gopinath emphasises how countries need to ensure that all people can benefit from new growth opportunities. Taking action that boosts economic growth while at the same time improving inclusiveness is needed across all economies, according to Gopinath. “How do you continue to raise income levels and improve the livelihoods of people while at the same time not creating increased inequality? How do we get people who have otherwise not been big participants in the global economy to play a bigger role? All of this is important for sustainability.”

Alicia García-Herrero 17 June 2020

Even pre-Covid-19 there were signs of manufacturing FDI movement away from China.
Alicia Garcia-Herrero, recorded 21 May 2020 at CEPR / LSE IGA / SPP webinar on:
Recovering from COVID-19 – China and global value chains in the wake of the pandemic

Yiping Huang 17 June 2020

Although coronavirus infection rates have dropped considerably in China and businesses are starting to return to something resembling normality, there is still a high state of alert and outbreaks are treated with an immediate and firm response.
Huang Yiping, recorded 21 May 2020 at CEPR / LSE IGA / SPP webinar on:
Recovering from COVID-19 – China and global value chains in the wake of the pandemic

David Miles 09 June 2020

How many people have already been infected with Covid-19? Without randomised mass testing, current estimates vary enormously. Meanwhile, post-lockdown policy choices based on this data are literally a matter of life and death. David Miles of Imperial College tells Tim Phillips about how he estimated the asymptomatic rate of infection, and the surprising result he found.

Annie Tubadji 05 June 2020

We know the probability of dying from COVID-19 is higher in certain deprived groups. In a new paper in Covid Economics, Annie Tubadji argues that “unprecedented economic and cultural class cleansing is occurring throughout the world during the COVID-19 pandemic”. 

Dalia Marin 05 June 2020

Hyperglobalisation radically changed the global economy, but also meant that national economies became increasingly interdependent. So will Covid-19 start to unpick those connections? Dalia Marin of the Technical University of Munich thinks so.

Ricardo Reis 03 June 2020

Ricardo Reis, London School of Economics, talks to Tim Phillips. Swap lines between advanced economy central banks are a relatively recent and important part of the global financial architecture. How has their role been affected by Covid-19?



CEPR Policy Research