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Papers in the special issue were presented at the Public Policy Lessons conference, the third conference in the After the Pandemic Conference Series, organized by the International Centre for Economic Analysis (ICEA) and held online, Nov 12-13, 2021.

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This paper reviews the literature on incorporating behavioural elements into epidemiological models of pandemics. While modelling behaviour by forward-looking rational agents can provide some insight into the time paths of pandemics, the non-stationary nature of Susceptible-Infected-Removed (SIR) models of viral spread makes characterisation of resulting equilibria difficult. Here I posit a shortcut that can be deployed to allow for a tractable equilibrium model of pandemics with intuitive comparative statics and also a clear prediction that effective reproduction numbers (that is, R) will tend towards 1 in equilibrium. This motivates taking R̂ = 1 as an equilibrium starting point for analyses of pandemics with behavioural agents. The implications of this for the analysis of widespread testing, tracing, isolation and mask-use is discussed.

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While the COVID-19 pandemic and recovery unfold in real time, this article investigates some of the major themes on preparations for the next pandemic. Humanity cannot rely on modern medicine to beat the coming ‘disease X’ and the world cannot afford the extortionate health and economic policy interventions during the COVID-19 pandemic again. From the COVID-19 pandemic we learned that the international economic organizations suffered from disaster myopia and that the self-image of the advanced economies is distorted. It also has become apparent that ‘beggar-thy-neighbor’ health care was generally practiced while global health care should have been the norm. A discussion on the related issues of rationing, triage and scarcity of health care during a pandemic is urgently needed. All in all, a major global investment project is necessary to reduce the vulnerability to and impact of pandemics. As inequalities to a large extent determine pandemic vulnerability, an adjustment of Sustainable Development Goals (SDG) is necessary.

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Is ethnic inequality associated with aversion to authoritarian regimes and increase support for democracy as a means of influencing redistribution? Using four rounds of Afrobarometer panel data, covering 29 African countries and 353 distinct ethnic groups, and an ordered logistic model, we show that a rise in Between-ethnic inequality (BGI) is associated with an increase support for anti-authoritarianism and that its effects strengthen as Within-ethnic inequality (WGI) decreases. We find that individuals most strongly support democracy when ethnic identity is reinforced by economic inequality. We also show that support for a change of regime is reinforced when some ethnic groups believe they are politically excluded from government.

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In response to the COVID-19 pandemic, many countries, including the U.S., adopted intervention policies aimed at averting the spread. However, these policies may have led to significant changes in public health behaviors. We use Google search queries to examine how state government actions are associated with people’s internet searches (internet browsing habits) related to health behaviors. We employ the di erences-in-di erences method to determine the link between disease outbreak, associated intervention policies, and changes in health behavior related searches. Our findings show that school closures, restaurant restrictions, and stay-at-home orders lead to a significant rise in searches for workout, physical activity, exercise, takeout, liquor, and wine. Moreover, people’s concerns regarding weight loss, diet, nutrition, restaurant, and fast food substantially decline following stay-at-home orders. Our event-study results indicate that changes in health behaviors began weeks before stay-at-home orders were implemented contemporaneously with emergency declarations and other partial closures. These findings suggest that people’s health behaviors are notably a ected by state government’s intervention policies.

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Will the widespread use of cashless payments reduce the frequency of the use of cash payments? This question is important because the major costs of cash use are fixed costs that would only be reduced if the frequency of cash payments substantially decreased, and thus the extent of the reduction of the cost of cash use depends on the frequency of cash use after the widespread use of cashless payment methods. Using the data from the Financial Literacy Survey 2019 in Japan, this paper shows that the frequency of cash use for those who use both cash and noncash payment methods and that of those who exclusively use cash are about once in 2.3 days and about once in 2 days, respectively, and thus there is only a slight difference. The result did not change even if a regression model for cash usage was used that considers the endogenous choice of payment methods or if counterfactual simulations of the decrease in consumers’ willingness to use cash were conducted. The results suggest that the benefit of reducing the cost of cash use due to the widespread use of cashless payment methods is overestimated because the frequency of the use of cash payments is unlikely to decrease despite the use of cashless payment methods.

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The REITs market has attracted a lot of interest among the academic, policymakers, and market participants. The linkages between REITs and macroeconomic and financial variables have been adequately explored in the literature, with more emphasis on linear models. This study expands the frontier of knowledge by examining the role of uncertainty in the comovement/spillover between REITs and the currency markets. Some interesting results were observed. First, using the Diebold and Yilmaz (2012) spillover test, we find that there is strong connectedness between the REITs and currency markets. Second, the BDS test shows that nonlinearity is a very crucial factor to be put into consideration when examining the role of EPU in affecting the interactions between REITs and exchange rate markets. Third, the non-parametric causality-in-quantile test confirms that the connectedness between the markets and EPU is stronger around the lower and middle quantiles. These results have important policy implications for policymakers and market participants. The study also offers suggestions for future research.

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Bitcoins are evolving as a modern class of investment assets and it is crucial for investors to manage their investment risk. This paper examines the impact of macroeconomic-financial indicators on Bitcoin price using symmetric and asymmetric version of autoregressive distributed lag (ARDL) models with structural breaks. The asymmetric long-run association ascertained between Bitcoin prices and the macroeconomic-financial indicators is evident. Our empirical results indicate that the Bitcoin cannot be used to hedge against the inflation, Federal funds rate, stock markets and commodity markets. We further find that Bitcoin can be regarded as a hedging device for the oil prices. Our findings have significant implications for market participants who consider including alternate investment assets in their portfolios.