How the Coronavirus will Change the Future Economy
AAEA Past-President speaks on the effects of COVID-19
The New York Times ran a story on March 15, 2020 with the heading “There Is Plenty of Food in the Country.” Though this statement may hold true, there could be more serious food market disruptions. Some of the stock-outs and slowdowns in grocery check-out lines are because employees are staying at home and practicing social-distancing. This problem is likely to grow if more people become ill. So, while we might have the food supply available, will we have the workers to get it to us?
Jayson Lusk, Distinguished Professor and Head of the Department of Agricultural Economics at Purdue University, wrote about the effects the coronavirus could have at the grocery stores, farms, food markets and economy in his latest blog post.
“It has been fascinating to watch online, and in my own local grocery stores, which items consumers are choosing to stock-up on. The run on toilet paper, for example, seems on the surface of it, downright irrational. After all, COVID-19 does not cause digestive issues. As irrational as the initial movement to toilet paper may seem, it isn’t crazy for subsequent consumers to then stock up too. After all, it doesn’t take much for a reasonable person to see that if all other consumers are buying up all the toilet paper, that they’d better off getting theirs before none is left. There is a long and interesting economics literature on information cascades and herding behavior, which shows that even if you disagree with what other people are doing, it is sometimes sensible to go along with the crowd” Lusk says.
Lusk continued to comment on the possibility of a recession, “During the past recession [“Great Recession” in 2007-09], rates of food insecurity spiked. There are concerns about impacts of school closures on childhood food security, and the USDA is considering policies that will allow delivery of free school lunch and breakfast to low income children even in instances where schools are closed.
You can read his full blog post here: http://jaysonlusk.com/blog/2020/3/16/impacts-of-coronavirus-on-food-markets
If you are interested in setting up an interview with Lusk, please contact Allison Scheetz in the AAEA Business Office.
ABOUT AAEA: Established in 1910, the Agricultural & Applied Economics Association (AAEA) is the leading professional association for agricultural and applied economists, with 2,500 members in more than 60 countries. Members of the AAEA work in academic or government institutions as well as in industry and not-for-profit organizations, and engage in a variety of research, teaching, and outreach activities in the areas of agriculture, the environment, food, health, and international development. The AAEA publishes two journals, the American Journal of Agricultural Economics and Applied Economic Perspectives & Policy, as well as the online magazine Choices and the online open access publication series Applied Economics Teaching Resources. To learn more, visit www.aaea.org.
Contact: Allison Scheetz
Senior Communications Manager