Lending and the Prisoner's Dilemma
Plus! Test-and-trace, costs and benefits, life insurance, drugs
There are two schools of thought around rapid macroeconomic intervention to mitigate the impact of Covid-19:
Stabilize aggregates like nominal GDP, or
Bail out specific borrowers/lenders
The first option is much, much easier to implement. In theory, you could get their entirely by cutting taxes and monetizing the ensuing deficit. But it’s a blunt instrumen…
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