A Rochester professor explained a simple point about the prospects for economic recovery: it will depend on how effectively we can combat COVID-19.
Narayana Kocherlakota, the Lionel W. McKenzie Professor of Economics at the University of Rochester and a former president of the Federal Reserve Bank of Minneapolis, discussed this point in a recent interview.
“If people are worried about the disease, they’re less likely to get a haircut or go to a restaurant. So the disease operates as a drag on the economy,” he says. “The better we do on public health, the better the economy will do.”
Kocherlakota says ultimately, the length of time it takes for the coronavirus to stop being a major factor in our lives is the biggest factor for the economy’s performance.