Abstract
Abstract While some argue that market forces are imperative to stimulate the increased supply of critical products and services to address the COVID-19 crisis, others contend that dealing with the pandemic requires coordination and rapid adjustments in supply that may be constrained by a host of factors. Although discussions have centered on policies to promote financial liquidity, we examine whether the state apparatus-not only state-owned enterprises but also development agencies and investment funds-can innovate and adjust production processes to improve infrastructure and capabilities to prevent and treat the disease. Potential actions include public-private effort addressing both discovery and coordination problems-such as a collaborative effort to develop prevention and treatment technologies, as well as state capital to stimulate retooling and expansion of strategic infrastructure. The state apparatus can also help access remote and critical areas with relatively lower private returns. In contrast, support to industries must be implemented with caution, especially for sectors whose demand may suffer permanently due to lifestyle changes. Exit strategies must be carefully crafted to avoid the risk of perpetuating unjustified and ineffective state support, establishing milestones and termination clauses based on clear performance indicators. We argue that, although using the state apparatus as a countermeasure entails a set of risks, not using it may increase the risk of extending the crisis and end with an overloaded state sector (e.g., due to massive bailouts), challenging the implementation of subsequent adjustments.
Highlights
¿Leviatán como una cura parcial? Oportunidades y dificultades al usar el aparato estatal para responder a la crisis de COVID-19
Leviathan as a partial cure? Opportunities and pitfalls of using the state-owned apparatus to respond to the COVID-19 crisis
While some argue that market forces are imperative to stimulate the increased supply of critical products and services to address the COVID-19 crisis, others contend that dealing with the pandemic requires coordination and rapid adjustments in supply that may be constrained by a host of factors
Summary
A pandemia COVID-19 sem precedentes provocou um novo debate sobre os méritos dos mercados em comparação ao Estado na forma de abordar agudas crises sociais. Outros afirmam que lidar com a pandemia requer ajustes rápidos na oferta que podem ser limitados por uma série de fatores. Essas respostas podem exigir um esforço coordenado - por exemplo, o valor do investimento em infraestrutura hospitalar depende de ações que afetam a prevenção. Como em outras graves e imprevisíveis crises, uma questão natural é se e em quais condições o aparato estatal pode ajudar a promover esses ajustes necessários. Revisamos os prós e os contras do envolvimento do Estado e descrevemos uma série de ferramentas de políticas públicas arato estatal, que podem ser eficazes dependendo da extensão e gravidade da crise. Políticas não levem ao apoio estatal improdutivo e injustificado, mesmo após a crise—um problema que muitas vezes é negligenciado por aqueles que propõem maior envolvimento momentâneo do Estado, exigindo investimento adicional e esforço coordenado
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
