government macroeconomy

Problem set 2 – due on Wednesday, 17 March 2021 (noon)

Please send one Word document by email, named as follows: firstname_lastname_PS2.docx

1. In half a page to one page (maximum): The Covid pandemic has impacted labor market outcomes

in most countries around the world. Pick a country you are interested in - what type of

information (e.g., indicators) would you gather, if you were asked to evaluate the extent of this

impact and whether you might expect longer-term or scarring effects on the labor market?

Describe the set of indicators you have identified and how they would contribute to your

assessment. (Some hints: for the United States, the Bureau of Labor Statistics news releases; for

European countries, Eurostat news releases the EU labor market; International Labor

Organization’s ILO Monitor; Country reports by the IMF or World Bank).

2. In one to two pages (maximum, single-spaced, Word document): Imagine you are a Staffer

specialized in International Affairs in U.S. Congress. You have been tasked with writing up to four

recommendations (maximum) on how the United States can contribute to a post-pandemic

rebound of the global economy. You have read the latest OECD economic outlook and some press

reports about it (OECD Economic Outlook, Interim Report “Strengthening the recovery: The need

for speed”, MARCH 2021). Please structure your argument as follows:

Part 1: Background: How might boosting growth in the United States reignite global growth?

Describe the various channels through which the U.S. might support a global recovery (i.e., in the

rest of the world).

Part 2: Recommendations: Think about what elements members of Congress might consider

when coming up with a stimulus plan, by weighing domestic and global political economy

constraints. Make three to four concise arguments based on your analysis, as to why you would

recommend enacting a larger or a more limited fiscal stimulus in the current context. (Decide

which side of this debate you will defend – by choosing one side and make three to four

recommendations to this end).