The economy is crucial for our well-being

Algemeen Dagblad

Sandra Phlippen, Professor of Applied Economics at Erasmus School of Economics and Chief Economist at ABN Amro explains in her weekly column in Dutch newspaper Algemeen Dagblad why many countries are starting to open their economies, despite not meeting the conditions set by the European Commission.

Too fast

After the holidays in May, the doors of primary schools in the Netherlands, France and Switzerland will open again. Even in Italy, the lockdown measures are being relaxed. According to the rules of the European Commission, we are going too fast. For the measures to be relaxed, three conditions have to be met: the spread of the virus had to show a significant contraction, the healthcare sector had to be able to operate at normal capacity again and technology had to allow testing and tracing people in case of illness. The last two conditions have hardly been met. According to Phlippen, the relaxation of the rules is due to the fact that there is more to the current situation than just the virus alone.

The economy and our well-being

Simply said, the economy is crucial for our well-being. The economy is much more than making profits and earning income. All public life revolves around the economy. Without the economy we would not be able to travel, go out, play sports or shop. We need the economy in order to fill our spare time. Phlippen emphasizes how the current events show that we really cannot live without it. More and more people are not adhering to the rules, and then it is probably wise for the government to follow.

Bitter

According to the booklet of the European Commission, European countries should take an example from China: suppress public life considerably, create an enormous capacity in the healthcare sector and make sure the technology is in order. Although we do not like this idea, it does ensure that the economy recovers more quickly. Our less rigorous approach towards the virus is very bitter for China. Because our economy is recovering more slowly, the demand for Chinese products is also considerably lower. Nevertheless, we will probably not change the European approach. After all, our economy is inextricably linked to the feeling that we are living, according to Phlippen.

Professor
More information

The full article from Algemeen Dagblad, 2 May 2020, can be found here (in Dutch).