A huge group of economists have signed the open letter to the Australian government
- measures taken to date have come at a cost to economic activity and jobs, but believe these are far outweighed by the lives saved and the avoided economic damage due to an unmitigated contagion.
- We believe that strong fiscal measures are a much better way to offset these economic costs than prematurely loosening restrictions.
- borders will need to remain under tight control for an extended period
- vital to keep social-distancing measures in place until the number of infections is very low, our testing capacity is expanded well beyond its already comparatively high level, and widespread contact tracing is available.
I suspect the views expressed would be shared by economists in other countries, which makes its relevance broader than just Australia. Social-distancing measures, as in place now, are very damaging indeed to the economy and may be in place for some time to come. The data from China (even despite the questions that surround China data) show the demand destruction inflicted on the economy of measures.
