The COVID-19 crisis has caused the greatest collapse in global economic activity since 1720. Some advanced countries have mounted a massive fiscal response, both to pay for disease-fighting action and to preserve the incomes of firms and workers until the economic recovery is under way. But there are many emerging market economies which have been prevented from doing what is needed by their high existing levels of public debt and-especially-by the external financial constraints which they face. We argue in the present paper that there is a need for international cooperation to allow such countries to undertake the kind of massive fiscal response that all countries now need, and that many advanced countries have been able to carry out. We show what such cooperation would involve. We use a global macroeconomic model to explore how extraordinarily beneficial such cooperation would be. Simulations of the model suggest that GDP in the countries in which extra fiscal support takes place would be around two and a half per cent higher in the first year, and that GDP in other countries in the world be more than one per cent higher. So far, such cooperation has been notably lacking, in striking contrast with what happened in the wake of the Global Financial Crisis in 2008. The necessary cooperation needs to be led by the Group of Twenty (G20), just as happened in 2008-9, since the G20 brings together the leaders of the world's largest economies. This cooperation must also necessarily involve a promise of international financial support from the International Monetary Fund, otherwise international financial markets might take fright at the large budget deficits and current account deficits which will emerge, creating fiscal crises and currency crises and so causing such expansionary policies which we advocate to be brought to an end.

The UK government faces a massive post-COVID problem in restructuring failing companies and rebuilding its already depressed regions. A missing part of the solution is to link government as well as private-sector funding to the financing of small and medium-sized enterprises (SMEs) in the regions. The institutional structure that is required has precedents in the UK, which can be used as the basis for reforming the funding of its SMEs.

The nature and scale of the shocks to the demand for, and the supply of, home childcare during the COVID-19 pandemic provide a unique opportunity to increase our understanding of the division of home labour and the determinants of specialization within the household. We collected real-time data on daily lives to document the impact of measures to control COVID-19 on UK families with children under the age of 12. We document that these families have been doing the equivalent of a working week in childcare, with mothers bearing most of the burden. The additional hours of childcare done by women are less sensitive to their employment than they are for men, leaving many women juggling work and (a lot more) childcare, with likely adverse effects on their mental health and future careers. However, some households, those in which men have not been working, have taken greater steps towards an equal allocation, offering the prospect of sharing the burden of childcare more equally in the future.

The public health response to COVID-19 in many countries has involved strict restrictions on movement and economic activity which threaten the livelihoods of economically vulnerable households. In response, governments are adopting emergency economic measures to provide households with some safety net. We provide an overview of the policies that could form a comprehensive social protection strategy in low-income and middle-income countries, with examples of specific policies that have been adopted. Our core argument is that these countries can cast an emergency safety net with extensive coverage if they use a broader patchwork of solutions than higher-income countries. These strategies could include expanding their social insurance system, building on existing social assistance programmes, and involving local governments and non-state institutions to identify and assist vulnerable groups who are otherwise harder to reach.

This paper argues for the regular testing of people in groups that are more likely to be exposed to SARS-CoV-2, to reduce the spread of COVID-19 and resume economic activity. We call this 'stratified periodic testing'. It is 'stratified' as it is based on at-risk groups, and 'periodic' as everyone in the group is tested at regular intervals. We argue that this is a better use of scarce testing resources than 'universal random testing', as has been recently discussed globally. We find that, under reasonable assumptions and allowing for false negative results 30 per cent of the time, 17 per cent of a subgroup would need to be tested each day to lower the effective reproduction number R from 2.5 to 0.75, under stratified periodic testing. Using the same assumptions the universal random testing rate would need to be 27 per cent (as opposed to 7 per cent as argued by Romer (2020b)). We obtain this rate of testing using a corrected method for calculating the impact of an infectious person on others, and allowing for asymptomatic cases. We also find that the effect of one day's delay between testing positive and self-isolating is similar to having a test that is 30 per cent less accurate.

The paper argues that to govern a pandemic, governments require dynamic capabilities and capacity-too often missing. These include capacity to adapt and learn; capacity to align public services and citizen needs; capacity to govern resilient production systems; and capacity to govern data and digital platforms.

We provide quantitative predictions of first-order supply and demand shocks for the US economy associated with the COVID-19 pandemic at the level of individual occupations and industries. To analyse the supply shock, we classify industries as essential or non-essential and construct a Remote Labour Index, which measures the ability of different occupations to work from home. Demand shocks are based on a study of the likely effect of a severe influenza epidemic developed by the US Congressional Budget Office. Compared to the pre-COVID period, these shocks would threaten around 20 per cent of the US economy's GDP, jeopardize 23 per cent of jobs, and reduce total wage income by 16 per cent. At the industry level, sectors such as transport are likely to be output-constrained by demand shocks, while sectors relating to manufacturing, mining, and services are more likely to be constrained by supply shocks. Entertainment, restaurants, and tourism face large supply and demand shocks. At the occupation level, we show that high-wage occupations are relatively immune from adverse supply- and demand-side shocks, while low-wage occupations are much more vulnerable. We should emphasize that our results are only first-order shocks-we expect them to be substantially amplified by feedback effects in the production network.

The British government has been debating how to escape from the lockdown without provoking a resurgence of the COVID-19 disease. There is a growing recognition of the damage the lockdown has caused to economic and social life. This paper presents a simple cost-benefit analysis inspired by optimal control theory and incorporating the SIR model of disease propagation. It also reports simulations informed by the theoretical discussion. The optimal path for government intervention is computed under a variety of conditions. These include a cap on the permitted level of infection to avoid overload of the health system, and the introduction of a test and trace system. We quantify the benefits of early intervention to control the disease. We also examine how the government's valuation of life influences the optimal path. A 10-week lockdown is only optimal if the value of life for COVID-19 victims exceeds £10m. The study is based on a standard but simple epidemiological model, and should therefore be regarded as presenting a methodological framework rather than giving policy prescriptions.

Government bailouts of corporate sectors in the COVID-19 crisis are part of a tripartite arrangement between government, business and institutional investors. Business should respond to the changing preferences of customers, employees and societies by identifying value propositions that justify the provision of risk capital by institutional investors. Critical to this is the determination and implementation of corporate purposes by owners and board directors that focus on inter-generational horizons. Family owners are particularly well placed to do this, but institutional investors need to make it part of their stewardship function as well. Measurement is key and significant reforms are required in the areas of accounting, valuation and reporting. Consistent with these observations, companies that had strong environmental, social and governance records performed better during the initial stages of the crisis, as did family owned firms and those that avoided high levels of leverage prior to the crisis.

The COVID-19 pandemic is ripping around most of the world, but not in Africa; at least, not yet. At the same time, the policy response is remarkably uniform: most of sub-Saharan Africa went into lockdown from the second week in March. What happens next for the pandemic across Africa is uncertain, but the March lockdowns are unlikely to have contained the epidemic by themselves. What is clear is that the combination of domestic lockdowns and the spill-over from the global recession means immediate and severe hardship. This paper looks beyond the public health aspects of the pandemic to examine the medium-term macroeconomic adjustment challenge confronting domestic policy-makers and international donors. We combine epidemiological and macroeconomic models to calibrate the scale of the combined shock to a representative low-income African economy and to show how alternative policy options for slowing transmission of COVID-19 impact on public revenue, and on GDP in the short run, and hence shape the path to recovery. Noting that the first lockdown, however costly, does not by itself eliminate the likelihood of a re-emergence of the epidemic, we then frame the agenda for key macroeconomic and public finance policies to sustain recovery, growth, and poverty reduction in sub-Saharan Africa. The initial hit to consumption will be up to one-third. All the public policy options are grim. International donor finance of US$40-50 billion, together with domestic reform to accelerate recovery, would make a significant difference to the outlook for poverty.

The COVID-19 pandemic has created both a medical crisis and an economic crisis. As others have noted, we face challenges just as big as those in the Spanish Flu Pandemic and the Great Depression-all at once. The tasks facing policy-makers are extraordinary. Many new kinds of intervention are urgently required. This issue of the has two objectives. The first is to explore these new interventions: evaluating their use, suggesting how they might be improved, and proposing alternatives. The second is to show that the challenges facing us are global and will require international cooperation if they are to be dealt with effectively. This short introductory essay positions the papers in the issue within an overall conceptual framework, with the aim of telling an overarching story about the pandemic.

This study documents a substantial decline in the exports of major trading nations taking place in March 2020. Accounting for product-specific seasonality and annual trends, the data suggest a drop by 38 per cent in France, about a quarter in Turkey and Germany, and 12 per cent in the US, relative to their historical averages. Detailed export data from Turkey, disaggregated by financing terms, show another striking pattern. Flows using bank intermediation which eliminates or reduces the risk of non-payment or non-arrival of prepaid goods, such as letters of credit or documentary collection, appear to have been much more resilient to the current downturn relative to flows using other financing terms. These findings suggest that access to trade finance is vital during times of heightened uncertainty.

This paper compares and contrasts the resilience of the financial system, in particular banks, during the Global Financial Crisis and COVID-19. We show that banks are now part of the solution, rather than part of the problem, thanks to regulatory and institutional reforms over the past decade. Heeding the lessons from the Global Financial Crisis has paid dividends. We outline some early lessons from the COVID-19 crisis for the financial system going forward.

Efforts to support public policy decisions need to be conducted carefully and thoughtfully. Recent efforts to estimate the social benefits of reductions in mortality risks associated with COVID-19 interventions are likely understated. There are large uncertainties over how much larger the social benefits could be. This raises questions about how helpful conventional approaches to valuing mortality and morbidity risks for benefit-cost analyses can be in contexts such as the current crisis.

As soon as the scale of the coronavirus shock to the economy became clear, the UK government introduced three policies to protect directly household incomes: a Job Retention Scheme, to pay the wages of employees who were temporarily furloughed; a Self-Employment Income Support Scheme, to give grants to established self-employed people whose businesses had been affected; and a package of increases to entitlements to social security benefits, with Universal Credit at the core, that bolstered the UK's means-tested 'safety net'. This paper analyses the design and beneficiaries of these policies and, given the distributional pattern of the labour market shock, considers the emerging overall impact on living standards, particularly of low-income households.

This paper explores the concept of 'global public goods' (GPGs) in the context of the ongoing COVID-19 pandemic. It argues that many of the tasks involved in public health, and in particular those involved in the control of an infectious disease like COVID-19, ought to be treated as GPGs that can only be effectively delivered through international cooperation. It sets out what a cooperative response to the COVID-19 pandemic should look like and introduces ideas for further discussion about how it might be financed.

This article discusses the challenges and potential policy choices for levying progressive taxes and taxing the rich in Latin America, a region known for its high-income inequality, limited tax-collection capacity, and low share of taxes collected from personal income and wealth. Factors such as high exemption thresholds, low top marginal tax rates, and limited administrative capacity undermine the redistributive ability and revenue collection of the tax systems in the region. Moreover, the income composition for the top percentiles largely comes from capital, and the effective tax rates they face are often low due to the preferential treatment of capital income and wealth. After discussing the evidence of how the rich in Latin America respond to progressive taxes on income and wealth and changes in enforcement policy, we provide some insights on potential policy choices to tax them effectively. These may include broadening the income tax base by lowering the number of exempt and non-taxable income items and the statutory exemption thresholds, reevaluating preferential tax rates on capital income, monitoring foreign income, addressing the abuse of tax treatment by business earners, and enhancing tax administration capacity. Additionally, wealth taxes may complement the tax system with updates to property registers and scrutiny of foreign assets.

Machine learning is an increasingly key influence on the financial services industry. In this paper, we review the roles and impact of machine learning (ML) and artificial intelligence (AI) on the UK financial services industry. We survey the current AI/ML landscape in the UK. ML has had a considerable impact in the areas of fraud and compliance, credit scoring, financial distress prediction, robo-advising and algorithmic trading. We examine these applications using UK examples. We also review the importance of regulation and governance in ML applications to financial services. Finally, we assess the performance of ML during the Covid-19 pandemic and conclude with directions for future research.

Significant regional inequalities of income and wealth exist in every Western European country and in North America, but their extent varies from country to country. In both Europe and the US, it is generally thought that they tended to narrow from the early 1900s until about 1980, since when they have widened. This widening has become associated with the rise of populism, while the Covid-19 crisis has thrown regional disadvantage into sharp relief. This article discusses measurement issues, traces developments over time, and explores the social and economic consequences of regional disparities. It describes the evolution of regional policy, and in particular the move to more localized approaches in Europe, analysing their strengths and weaknesses.

Children are increasingly recognized as secondary victims of intimate partner violence. This paper uses a unique UK longitudinal child development survey to study the relationship between verbal and physical abuse experienced by mothers and children's development up to the age of seven. Estimating production functions for cognitive, social, and socio-emotional skills, we find that exposure during pre-school years has a quantitatively important negative effect on socio-emotional skills among toddlers and negatively affects cognitive and social skills after the age of three. The estimated impact on cognitive development is consistent with measures of cognitive skills based on school-based tests.

Humanitarian policies aimed at welcoming forced migrants may yield unexpected economic dividends. This article focuses on the trade and investment links forged by refugees between their countries of resettlement and the origins they fled. We document how such immigrant-links differ in the case of refugees, focusing on why their opportunity sets might differ and the difficulties in establishing economic connections against a backdrop of civil conflict and political unrest. We conclude by discussing a range of policies aimed at engaging refugee diasporas to foster development at refugees' origins.