Abstract
Beyond the immediate impositions of dealing with COVID-19, this disease represents a severe and significant challenge confronting Pakistan’s economy. The study’s objective was to evaluate the coronavirus epidemic’s effect on Pakistan’s economy and measures devised to mitigate the damage done by this disease. The study research design used the elementary concept of Keynesian theory comprising of the mapping of systematic behavior of the COVID-19 pandemic. Issues were formally underpinned, described, and visualized through the Keynesian theory concept. The eruption of COVID-19 has jolted the national and international economy. Pakistan is included, causing millions of people to stay at home, lose their jobs, and suspend or end business operations. Unemployment in Pakistan has reached nearly 25 million people, driving many towards conditions of hunger and poverty as the major economic damage in several sectors is anticipated at around PKR 1.3 trillion. The hardest-affected sectors comprise industries such as tourism and travel, financial markets, entertainment, manufacturing, etc., having a devastating effect on gross domestic product (GDP). It is mainly daily-wage earners and people running small businesses that have been seriously exploited and subjected to a curfew-like situation. However, the Keynesian theory suggests that supportive macroeconomic policies must restore trust, demand recovery, and provide interest-free loans to overcome Pakistan’s currently upcoming crisis.
Highlights
The tourism industry is largely redundant, and many people will be unemployed because COVID-19 has natural and long-lasting ramifications for social interaction and entertainment
This study investigated the real consequences of COVID-19 on the Pakistani economy using the Keynesian Aggregate Demand (AD)-AS theory, which is based on theoretical and logical premises [80,81,82]
Millions of people working in various industries are waiting impatiently for COVID-19 to end and never emerge again
Summary
The authors [17] stated that the most probable cause of the COVID-19 infection was the bats, which ended up being sold at a Wuhan market, where interactions between humans and live creatures occurred. [32,33] reported that the infection’s spread throughout the populace in different nations occurs at different rates, much depending on the nature of social, economic, and political variables, such as people’s responses, the density of the population, the size of family units, etc. The pandemic affects the world economy and creates a hazard to economic development among low- and middle-income countries like Pakistan [38,39]. Pakistan’s economy could overcome the vast challenges, while others author [42] suggested to come out with more advanced economic strategies and several theoretical and logical arguments to bolster aggregate demand.
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