Economic Policy Recommendations During the Coronavirus Pandemic in the Czech Republic

Sevcik, Miroslav; Zubikova, Adela; Klement, Josef; Kozak, Jan; Zeman, Martin; Smolak, Pavel; Lejsek, Tomas; Simunek, Lubor; Vesela, Kristyna

ECONOMIC POLICY RECOMMENDATIONS DURING THE CORONAVIRUS PANDEMIC IN THE CZECH REPUBLIC

MIROSLAV SEVCIK, ADELA ZUBIKOVA, JOSEF KLEMENT, JAN KOZAK, MARTIN ZEMAN, PAVEL SMOLAK, TOMAS LEJSEK, LUBOR SIMUNEK, KRISTYNA VESELA

Abstract:

The authors of the paper formulated selected recommendations for economic policy in the Czech Republic, the aim of which was primarily to mitigate the economic effects of the COVID-19 pandemic and to prevent a long-term recession. The authors of the text believe that, in order to strengthen the robustness of the economy, it is essential to support not only the demand side of the economy but also the supply side through fiscal impulses from public budgets, which have been automatically used by governments across the European Union. Recommendations leading to the reduction of the tax burden, the elimination and reduction of selected tax rates or the cancelling of the next phase of electronic records of sales are presented. Fiscal measures are supplemented by recommendations for monetary policy – namely the reduction of the basic repo rate and warnings of breaches of the economic paradigm and moral hazard associated with the purchase of government bonds by the central bank. Furthermore, a proposal for the faster loosening of restrictions to allow the resumption of economic and educational activities is also presented. In support of industry, the authors of the text strongly warn against the acceptance of the “European Green Deal” which could permanently damage the competitiveness of the European economy and lead to a long-term reduction in the well-being of EU citizens. The authors also warn against the permanent implementation of regulatory elements into national legislation, which reduce the degree of individual freedom, increase the degree of redistribution and are thus in fundamental conflict with the principles of free market competition. Finally, the text draws attention to the Ratchet effect associated with all the discussed processes and to the degeneration of supranational institutions and their étatist attempts at destroying the market-conforming arrangement of economic and political conditions.

Keywords:
Fiscal policy, Monetary policy, Economic policy measures, Economic policy implications, COVID-19, Coronavirus, Czech Republic, Green policy

DOI: 10.20472/BM.2020.8.1.008

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APA citation:
MIROSLAV SEVCIK, ADELA ZUBIKOVA, JOSEF KLEMENT, JAN KOZAK, MARTIN ZEMAN, PAVEL SMOLAK, TOMAS LEJSEK, LUBOR SIMUNEK, KRISTYNA VESELA (2020). Economic Policy Recommendations During the Coronavirus Pandemic in the Czech Republic. International Journal of Business and Management, Vol. VIII(1), pp. 155-175. , DOI: 10.20472/BM.2020.8.1.008