Slowdown in business dynamics during the COVID pandemic | VOX, CEPR Policy Portal
Andrew Bailey, Douglas J. Elliott, Victoria Ivashina The spread of the COVID-19 virus followed by lockdown measures and changes in economic behaviour have severely impacted businesses. Governments worldwide responded with a diverse and sizeable set of support instruments – including wage subsidies, tax deferrals, loan guarantees, and allowances for fixed costs – to protect employment and help businesses stay afloat. These support schemes and lockdown measures can affect future productivity via business dynamics through two main channels: firm entry and exit. The consequences of these meas...
Source: voxeu.org