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Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic

Although COVID-19 emerged as a global shock, governments adopted non-pharmaceutical policy responses that were rather heterogeneous, depending on cultural and institutional characteristics. At the country level, the stringency of ‘lockdown’-type policies should be set to achieve the best possible tr...

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Autor principal: Dragomirescu-Gaina, Catalin
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Elsevier B.V. 2021
Materias:
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8525467/
https://www.ncbi.nlm.nih.gov/pubmed/34333351
http://dx.doi.org/10.1016/j.ehb.2021.101052
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author Dragomirescu-Gaina, Catalin
author_facet Dragomirescu-Gaina, Catalin
author_sort Dragomirescu-Gaina, Catalin
collection PubMed
description Although COVID-19 emerged as a global shock, governments adopted non-pharmaceutical policy responses that were rather heterogeneous, depending on cultural and institutional characteristics. At the country level, the stringency of ‘lockdown’-type policies should be set to achieve the best possible trade-off between economic and fatality dynamics, obviously accounting for possible cross-border influences. To allow for policy learning, I assume that the first country implementing a policy initiative that is worth emulating must either get the best possible health or the best possible economic outcome. I propose a combination of sign and magnitude restrictions, embedded in a global VAR model, to identify idiosyncratic policy shocks that spill over and influence policy responses abroad. Once policy shocks are identified, I run a comparison exercise between two model specifications, i.e. with and without policy emulation. Within a given a sample, this methodology can be used to find when and where policy lessons can be identified. I find that, among 17 developed and developing countries, few can offer lessons based on their policy initiatives, but several others might get better trade-offs through policy emulation, although in reality this outcome is not guaranteed to have occurred.
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spelling pubmed-85254672021-10-20 Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic Dragomirescu-Gaina, Catalin Econ Hum Biol Article Although COVID-19 emerged as a global shock, governments adopted non-pharmaceutical policy responses that were rather heterogeneous, depending on cultural and institutional characteristics. At the country level, the stringency of ‘lockdown’-type policies should be set to achieve the best possible trade-off between economic and fatality dynamics, obviously accounting for possible cross-border influences. To allow for policy learning, I assume that the first country implementing a policy initiative that is worth emulating must either get the best possible health or the best possible economic outcome. I propose a combination of sign and magnitude restrictions, embedded in a global VAR model, to identify idiosyncratic policy shocks that spill over and influence policy responses abroad. Once policy shocks are identified, I run a comparison exercise between two model specifications, i.e. with and without policy emulation. Within a given a sample, this methodology can be used to find when and where policy lessons can be identified. I find that, among 17 developed and developing countries, few can offer lessons based on their policy initiatives, but several others might get better trade-offs through policy emulation, although in reality this outcome is not guaranteed to have occurred. Elsevier B.V. 2021-12 2021-07-27 /pmc/articles/PMC8525467/ /pubmed/34333351 http://dx.doi.org/10.1016/j.ehb.2021.101052 Text en © 2021 Elsevier B.V. All rights reserved. Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active.
spellingShingle Article
Dragomirescu-Gaina, Catalin
Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title_full Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title_fullStr Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title_full_unstemmed Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title_short Facing an unfortunate trade-off: policy responses, lessons and spill-overs during the COVID-19 pandemic
title_sort facing an unfortunate trade-off: policy responses, lessons and spill-overs during the covid-19 pandemic
topic Article
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8525467/
https://www.ncbi.nlm.nih.gov/pubmed/34333351
http://dx.doi.org/10.1016/j.ehb.2021.101052
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