Christine Laudenbach discussion of: Bailouts

Abstract

Countries around the world have approved trillions of dollars in spending packages as a response to the COVID-19 pandemic in order to protect people’s health and combat associated economic downturns. There was a wide range of measures to address corporate funding needs with the ultimate goal of preventing bankruptcies. Across countries, very different programmes have been put in place, not only because the countries differ in their capacity to finance them, but also because political decisions have to be taken under rapidly changing epidemiological and economic situations. In the context of corporate measures, examples include indirect wage subsidies such as the PPP programme, which is at the core of this paper, but also indirect subsidies such as the expansion of access to short-term work or the coverage of minimum wages.