Many of our researchers at the School of Economics have been working to create solutions to the economic fallout caused by the global coronavirus pandemic.
One important piece of research is on ‘Estimating the value of political connections for firm outcomes during a crisis’. The research, which focuses on India in the wake of the coronavirus, is being conducted by Amrit Amirapu and Irma Clots-Figueras and has been awarded a GCRF Emergency Response Fund grant. The goal of the research project is to better understand how governments’ emergency relief funds may be diverted from their most efficient uses by political connections between firms and politicians.
Amirapu and Clots-Figueras explain “Among the most alarming negative economic consequences of the spread of Covid-19, and the containment policies that governments all over the world have adopted, is the enormously adverse effect on firms and employment. In India, over 120 million people lost their livelihoods after the government ‘locked down’ the economy. Soon afterwards, the Indian central and state governments instituted a patchwork of policies aimed at providing relief to firms, workers and/or households – food distribution, cash-transfers, tax holidays, government decrees against firing workers, etc). We aim to shed light on the question of how effective poor countries’ governments can be in developing and enacting policies to mitigate the negative economic consequences of crises in the presence of corruption and low state capacity.
The research project is mainly related to the research areas and SDG’s surrounding sustainable livelihoods, inclusive economic growth and innovation, reduction of poverty and inequality, including gender inequalities.