Institutions are starting to draw attention to the potential economic effects of the coronavirus outbreak. However Covid-19 is not the cause of our economic malaise. Forecasters should be careful in presenting new economic releases on coronavirus and now allow this health matter to become an occasion for economic scaremongering.
Playing up the economic costs of Covid-19 could exacerbate fearful responses, as well as distract from the much longer-lasting sources of economic sickliness. Global growth and, especially, advanced-economy growth are already dismal, and have been for many years. Forecasts for this year were already pretty downbeat before most people were aware of the word coronavirus. The danger is that this acute health disease gets blamed for our economic troubles, while the chronic economic disease remains undiagnosed and untreated.
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