Sweden's less strict measures have helped the economy...but we will soon be facing difficult tradeoffs
Lars Calmfors, IFN, is interviewed by Times of India about his views on Sweden's Covid strategy:
When asked if governments need to offer more economic stimuli from time to time Lars Calmfors replies:
"Yes, they will probably have to do this, but the tradeoffs will become increasingly difficult. In the spring, policies were easy. It was just a matter of pumping out money to stave off an economic disaster without any need or any possibility of fine tuning. But we cannot do this for two-three years; measures will have to be better calibrated. For example, there would be huge social losses if we subsidise people to do nothing through various furlough schemes, which we as well as many other European countries have been doing. We should increasingly try to support activities that have good prospects for long-run expansion and new hires. But it will not be easy to find the right balance."