General information.
This course provides a first, broad overview of the economic aspects and consequences of the Covid-19 pandemic at the macro, micro and financial levels. The course attempts to strike a balance between the need of rigorousness peculiar to the economic analysis and the necessity to empirically describe the ongoing phenomena.
The course is mainly oriented to Master students but is also open to PhD students.
The course material will be provided through Learnweb and, if needed the course will turn to virtual. Every further communication should go through Learnweb.
The number of participants is limited and cannot be larger than 25. Registration is compulsory and made by sending an email to the secretary Andrea Rüschenschmidt ( rueschea@uni-muenster.de)
The exam consists of a home-essay whose topic will be communicated at the end of the course.
Overview of the topics.
On the macroeconomic ground, it will be shown that this pandemic initially consists of a battery of contemporaneous shocks affecting both the demand and the supply sides of the economy; both are triggered by the pandemic itself and by the government’s sanitary measures aiming at stem it. However absent economic policies, these shocks may initially affect aggregate consumption, investment and the labor market; moreover they may involve several other aspects of economic activity by propagating through several channels (represented by credit, stock, bonds, derivatives and commodities markets). This in turn may first have a feedback effect on present output (creating a great recession) and, more importantly, long-run consequences on the supply side of the economy such as hysteresis in the labor market and capital disruption (in all of its forms). Thus, the macroeconomic analysis will be accompanied by the description and examination of the performances of the above mentioned financial sectors by means of selected models proper to the financial economic theory.
Furthermore, potential conventional and unconventional economic (monetary and fiscal) policies will be described. Public spending, implementation of structural reforms, changes of official interest rates, and a broad description of non conventional monetary policy (QE, TLTRO, APP,...). Typical to a pandemic is that economic policies have to be coordinated with sanitary policies both at the local national and international level.
Other than the macroeconomic (macro- financial) aspects, the course provides some microeconomic analysis of portfolio and investment decisions at the individual level. The usual concepts of (financial, physical and human capital-based) investment will be reviseted along with the meanings of risk, return, diversification and markets completeness.
The last part of the course deals with some special topics connected with the pandemic. Some institutional aspects are revisited, in particular at the European level: EU governance, ECB’s revision of the monetary policy strategy. The microstructure and incentives pertaining the pharmaceutical industry are also considered.
- Lehrende/r: Andrea Beccarini