Question A:
The balance of federal and local government support to address the economic impact of the crisis has thus far been tilted too much towards supporting firms rather than individuals.
Responses
Responses weighted by each expert's confidence
Question B:
Government provision of financial support to firms to keep workers on payroll for the duration of the lockdown will make the recovery faster than if the only recourse for workers to replace income were unemployment insurance.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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 Daron Acemoglu |
MIT | Bio/Vote History | ||
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Protecting the supply chain against collapse is important as well
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 Alberto Alesina |
Harvard | Bio/Vote History | ||
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 Joseph Altonji |
Yale | Bio/Vote History | ||
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 Alan Auerbach |
Berkeley | Bio/Vote History | ||
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 David Autor |
MIT | Bio/Vote History | ||
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The U.S. overshot on increasing UI generosity rather than paying firms to retain workers. Other countries have done far better.
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 Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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 Abhijit Banerjee |
MIT | Bio/Vote History | ||
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 Marianne Bertrand |
Chicago | Bio/Vote History | ||
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 Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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 Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
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 Judith Chevalier |
Yale | Bio/Vote History | ||
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But my real criticism is that too little of the spending has been aimed at the virus itself - testing capacity, etc.
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 David Cutler |
Harvard | Bio/Vote History | ||
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 Angus Deaton |
Princeton | Bio/Vote History | ||
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 Darrell Duffie |
Stanford | Bio/Vote History | ||
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Hard to say. Subsidizing firms to reduce worker separations may help workers quite a lot. This calls for an analysis that I have not done.
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Supporting firms invites graft and lining the pockets of buddies
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 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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Both firms & individuals need (more) support. In terms of who should get more, much depends on what you think firms will do with their money
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 Liran Einav |
Stanford | Bio/Vote History | ||
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 Ray Fair |
Yale | Bio/Vote History | ||
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 Amy Finkelstein |
MIT | Bio/Vote History | ||
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 Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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See Question B): Keeping people on payroll is a more effective way to support individuals
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 Austan Goolsbee |
Chicago | Bio/Vote History | ||
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When people die, they can’t reorganize and come back.
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 Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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 Robert Hall |
Stanford | Bio/Vote History | ||
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In principle, it doesn't matter which side is subsidized. But he actual law is better at preserving employment on the employer side.
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 Oliver Hart |
Harvard | Bio/Vote History | ||
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It makes sense to support individuals who have lost their incomes. Firms can close for a period or renegotiate their contracts.
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 Bengt Holmström |
MIT | Bio/Vote History | ||
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 Caroline Hoxby |
Stanford | Bio/Vote History | ||
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The logic of social insurance indicates that working through firms is inefficient and poor targeting.
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 Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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 Kenneth Judd |
Stanford | Bio/Vote History | ||
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Certainly way too much help for large firms. Some big firms will benefit from the forgivable "loans".
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 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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do you think the firms ultimately will wind up insolvent rather than just illiquid? not clear now, lots of second guessing is inevitable
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 Pete Klenow |
Stanford | Bio/Vote History | ||
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Loans to firms could be forgivable if they furlough and recall their workers ex post.
-see background information here |
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 Jonathan Levin |
Stanford | Bio/Vote History | ||
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Both needed. Critical to support workers, and to ensure jobs are there as activity restarts.
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 Eric Maskin |
Harvard | Bio/Vote History | ||
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 William Nordhaus |
Yale | Bio/Vote History | ||
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 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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 Larry Samuelson |
Yale | Bio/Vote History | ||
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It appears as if we need more support to both firms and individuals.
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 José Scheinkman |
Columbia University | Bio/Vote History | ||
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Probably balance tilted too much to large firms and financial institutions as opposed to SMBs, health-care delivery and individuals.
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 Richard Schmalensee |
MIT | Bio/Vote History | ||
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Certainly tilted too much toward large firms that can survive bankruptcy, as the airlines have done, rather than small firms that can't.
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 Carl Shapiro |
Berkeley | Bio/Vote History | ||
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 Robert Shimer |
University of Chicago | Bio/Vote History | ||
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 James Stock |
Harvard | Bio/Vote History | ||
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 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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Hard to judge.
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 Christopher Udry |
Northwestern | Bio/Vote History | ||
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There are some egregious examples, but I'm not sure wrt the overall balance.
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Daron Acemoglu |
MIT | Bio/Vote History | ||
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Protecting firm-worker and firm-firm matches from being destroyed is valuable
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Alberto Alesina |
Harvard | Bio/Vote History | ||
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Joseph Altonji |
Yale | Bio/Vote History | ||
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Alan Auerbach |
Berkeley | Bio/Vote History | ||
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David Autor |
MIT | Bio/Vote History | ||
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Those worker-firm relationships were valuable. CARES subsidizes firms and workers to break those bonds, and this may slow recovery
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Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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Abhijit Banerjee |
MIT | Bio/Vote History | ||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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In theory, yes. But implementation of PPP programs so far seems to be a failure.
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Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
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Judith Chevalier |
Yale | Bio/Vote History | ||
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David Cutler |
Harvard | Bio/Vote History | ||
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Angus Deaton |
Princeton | Bio/Vote History | ||
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Darrell Duffie |
Stanford | Bio/Vote History | ||
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UI alone delays rematching workers and firms, and reduces the quality of matches, especially with a staggered restart (places and sectors).
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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care must be taken to be supporting workers.
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Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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Keeping them on payroll will limit suffering & loss of insurance. It will avoid rupturing connections. But it will also slow reallocation.
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Liran Einav |
Stanford | Bio/Vote History | ||
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Ray Fair |
Yale | Bio/Vote History | ||
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Amy Finkelstein |
MIT | Bio/Vote History | ||
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Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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Austan Goolsbee |
Chicago | Bio/Vote History | ||
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Pay-to-stay only works if we can go back to what we were doing before not if some industries are changed permanently. The virus is the boss.
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Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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Robert Hall |
Stanford | Bio/Vote History | ||
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UI in practice does not have job-preserving features, whereas subsidies to employers are conditioned on retaining workers, which is good.
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Oliver Hart |
Harvard | Bio/Vote History | ||
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I don't see why furloughed workers cannot be called back. During the crisis they may also be usefully employed elsewhere.
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Bengt Holmström |
MIT | Bio/Vote History | ||
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Caroline Hoxby |
Stanford | Bio/Vote History | ||
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The furlough provisions of CARE act offer a combination of job protection and pay replacement.The choice posed in the question is false one
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Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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Kenneth Judd |
Stanford | Bio/Vote History | ||
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Firms can use that money to pay workers they were going to keep. UI has often been used for layoffs. Good UI system would be best option.
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Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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disclosure: i am on the academic panel advising the Fed on its main street lending facility; on the question, see caveat to question a
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Pete Klenow |
Stanford | Bio/Vote History | ||
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Jonathan Levin |
Stanford | Bio/Vote History | ||
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Given high job loss, creating incentives to rehire will also be important as we restart activity.
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Eric Maskin |
Harvard | Bio/Vote History | ||
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William Nordhaus |
Yale | Bio/Vote History | ||
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Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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Larry Samuelson |
Yale | Bio/Vote History | ||
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Preserving the matching of workers to firms, by retaining workers on firms' payrolls, would hasten recovery by eliminating one step.
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José Scheinkman |
Columbia University | Bio/Vote History | ||
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Specially for small and medium enterprises.
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Richard Schmalensee |
MIT | Bio/Vote History | ||
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Keeping employment relationships intact will speed recovery, but there must be direct aid for the unemployed, particularly the undocumented.
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Carl Shapiro |
Berkeley | Bio/Vote History | ||
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Robert Shimer |
University of Chicago | Bio/Vote History | ||
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But this might keep some firms going, even if they should go bankrupt
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James Stock |
Harvard | Bio/Vote History | ||
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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Christopher Udry |
Northwestern | Bio/Vote History | ||
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Help in both directions is important to maintain the network of connections between firms and employees.
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