A few emerging policy recommendations on the effectiveness of countercyclical fiscal policies against the current COVID-19 crisis are explored. There are several reasons why COVID-19 spending might have smaller multipliers, including more precautionary behavior, hoarding cash, amplified by fear that people choose not to engage in travel and social activities, so that efforts to stimulate economic activity will be less effective. At the same time, a countervailing consideration is that many countries are also facing the kind of loose monetary policy conditions that help to increase the efficacy of fiscal stimulus.

Two types of infrastructure investments look to be of particular relevance to recovery from the COVID-19 crisis. The first is digital technologies, which have come into their own to support economic and social resilience while complying with public health directives on social distancing. Accordingly, the demand for digital goods and services has soared across the public and private sectors and exposed major deficiencies in the availability and performance of broadband infrastructure. The second category is green infrastructure, which offers relatively good performance on job creation, while at the same time shifting economies to lower carbon emission trajectories in the context of increasingly pressing global climate targets. Investments such as rural electrification, public transport, energy efficiency and renewable energy offer the possibility of contributing simultaneously to economic, environmental and social goals.

# **5. References**

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