...nancially constrained and at the same time help the economy to recover faster. In this sense, social transfers seem to provide an inclusive manner to deal with temporary and deep recessions, like during the COVID-19 pandemic. Second, because most of the e¤ect of a social transfer shock impacts the economy especially in the short- and medium-run (as opposed to having truly long-lasting e¤ects) and through private consumption (as opposed to via increasing the economy’s productive capacity and investment), this type of ...scal policy tool is far from ideal to increase long-term growth and productivity.

# References

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