Mary: I’m Mary Walden, with economist MW, welcoming you to the economic perspective. Today’s program looks at psychological impacts of the virus. Mike, everyone is hoping for a cure, or vaccine, for the Covid-19 virus. But once we get that, can we assume our economic behavior will return to where it was prior to the virus?
Mike: Summary Answer
- Unfortunately, economists who have studied this question say no
- There will be some long run psychological impacts of the virus that will impact the economy
- Specifically, for some time people will increase their probabilities of future viruses occurring
- This means the future will be forecasted to not be a good as those forecasts were pre-virus
- Means investments in the future will not be as strong, which will reduce economic productivity and investment returns
- Means – even if the economy grows – the trajectory of growth will not be as strong
- So we could be paying for the virus for decades
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.