Question

Briefly discuss five (5) ways in which economic planning can be used to reduce the economic impact of global pandemics such as the Corona Virus in the future.

Answer 1

Economic planning is an essential features , on which the economy of any nation rides and decides how smooth the dealing in economy will go. With the wake of Covid 19, there is a slow down , across the globe which needs to be tackled , otherwise the economies might get into a slump , harming every linkage of economy negatively.

Economic planning is must in times like these , and some of the tools which can be used are :

1. Having an expansionary fiscal policy :

Expansionary fiscal policy introduce both low tax rates and high investment through govt spending in the economy. Since these two can stimulate aggregate demand, economy can recover from slump.

2. Expansionary monetary policy: expansionary monetary policy both through high money supply or low rate of interest , can increase aggregate demand and economy in slump can recover.

3. Devaluation of economy: devaluation in economy can rise the levels of export for nation. This is good for generating trade surplus in economy , and also domestic market can get a bigger market to sell their products.

4. Encouraging foreign investments: foreign investments can increase the employment level which is essential for Economy's revival. Hence low rate of interest for encouraging foreign investments can help increase the employment opportunities .

5. Investments in basic sectors by the govt. :

Govt need to invest in sectors like employment generation, education etc. These help in dealing with the primary mass, which is involved in informal sector and got adversely hit by pandemic. Also relief and subsidies are also an important aspect while dealing with the Covid 19 pandemic.