Abstract
Research background: The global SARS-CoV-2 pandemic is for human society unprecedented. Coronavirus is dramatically changing people’s lives, and despite of uncertainty about the future, it is certain that its global consequences will have many dimensions. The it is undeniable that there have been significant economic impacts are unquestionable today impacts. The Czech economy, like the rest of the world, is facing an unexpected exogenous shock. This being manifests itself with varying intensity both at the level of sub-markets and on the side of aggregate supply and demand. It is literally a textbook example, explaining the outbreak of the downturn phase of the business cycle. Nevertheless, the sudden slowdown of economic activity as a result of the coronavirus pandemic, quarantine and the state of emergency, has many specificities across countries. Purpose of the article: The primary goal of this article is to analyze the economic consequences of the pandemic crisis in the reality of the Czech Republic. On this basis, it identifies the specifics of a pandemic crisis, in the context of a broader framework of economic theories of business cycles. Methods: The analytical part of the article is processed based on publicly available statistical data and economic forecasts. The derivation and argumentation of the conclusions is based on an empiric-inductive approach, methods of synthesis and comparison. Findings & Value added: The article maps the business direct and mediated economic contexts of the economic cycle caused by the coronavirus pandemic in the reality of the Czech Republic. It identifies the differences and specifics of the downward phase of the pandemic business cycle and derives their possible long-term impacts. At the theoretical level, the ambition of the article is to bring new knowledge to the contemporary economic theory of business cycles.
Highlights
Economists were already recording declines in output and fluctuating economic development as early as the beginning of the 19th century
In the context of the wider framework of economic theory on business cycles, our goal is to identify the direct and indirect economic effects of the pandemic business cycle, its specifics, and probable long-term impact
We have focused on defining key phenomena occurring within the pandemic crisis, which we tie into economic theory on business cycles and develop into general conclusions
Summary
Economists were already recording declines in output and fluctuating economic development as early as the beginning of the 19th century. These related to the transformation of agrarian economies into industrial economies. A number of economies around the globe failed as a result of this crisis, and it is considered to be one of the causes of World War II. The fall of the Lehman Brothers investment bank meant an end to this institution, but it caused stock markets around the world to crash. Even though the course of the pandemic is still a great unknown, cautious estimate for a decline in the global economy for 2020 have already been published. The International Monetary Fund predicted a decrease in the global economy of -4.9 % (for Europe -1.5 %, for the USA -1 %, and for China +2 %) [4]
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