Yet according to the latest global assessment from the United Nations Department of Economic and Social Affairs, these stimulus measures may not boost consumption and investment by much as policy makers are hoping.
Much of the money that households and businesses receive in the form of stimulus checks will probably sit idle in their bank accounts, owing to anxieties about the future and a broader reduction in spending opportunities.
This massive increase in bank reserves suggests that the stimulus policies implemented so far have had a low multiplier effect.
Governments must take it upon themselves to insure against today's risks, by offering compensation for firms in the event that the economy does not recover by a certain point in time.
For example, the government could guarantee that if a household purchased a car today, and the epidemic curve remained at a certain point six months from now, its monthly car payments would be suspended.
