We ask whether epidemic exposure leads to a shift in financial technology usage within and across countries and if so who participates in this shift. We exploit a datasetcombining Gallup World Polls and Global Findex surveys for some 250,000 individuals in 140 countries, merging them with information on the incidence of epidemics and local 3G internet infrastructure. Epidemic exposure is associated with an increase in remote-access (online/mobile) banking and substitution from bank branch-based to ATM-based activity. Using a machine-learning algorithm, we show that heterogeneity in this response centers on the age, income and employment of respondents. Young, high-income earners in full-time employment have the greatest propensity to shift to online/mobile transactions in response to epidemics. These effects are larger for individuals in subnational regions with better ex ante 3G signal coverage, highlighting the role of the digital divide in adaption to new technologies necessitated by adverse external shocks.

We review the debate on the association of financial globalization with inequality. We show that the within-country distributional impact of capital account liberalization is context specific and that different types of flows have different distributional effects. Their overall impact depends on the composition of capital flows, their interaction, and on broader economic and institutional conditions. A comprehensive set of policies – macroeconomic, financial and labor- and product-market specific – is important for facilitating wider sharing of the benefits of financial globalization.

The Covid-19 pandemic will have major implications for public trust in scientific expertise. But will this effect be positive or negative, and will it affect trust in individual scientists or science more broadly? Cevat Giray Aksoy, Barry Eichengreen and Orkun Saka write that people aged 18 to 25, whose core beliefs are still being formed, are likely to suffer the strongest impact of Covid-19 on their faith in scientists, but not in science.

In this paper we seek to make headway on the question of what recovery from Covid-19 recession may look like, focusing on the duration of the recovery - that is, how long it will take to re-attain the levels of output and employment reached at the prior business cycle peak. We start by categorizing all post-1960 recessions in advanced countries and emerging markets into supply-shock, demand-shock and both-shock induced recessions. We measure recovery duration as the number of years required to re-attain pre-recession levels of output or employment. We then rely on the earlier literature on business cycle dynamics to identify candidate variables that can help to account for variations in recovery duration following different kinds of shocks. By asking which of these variables are operative in the Covid-19 recession, we can then draw inferences about the duration of the recovery under different scenarios. A number of our statistical results point in the direction of lengthy recoveries.

Summary We assess the role of economic and security considerations in the currency composition of international reserves. We contrast the ‘Mercury hypothesis’ that currency choice is governed by pecuniary factors familiar to the literature, such as economic size and credibility of major reserve currency issuers, against the ‘Mars hypothesis’ that this depends on geopolitical factors. Using data on foreign reserves of 19 countries before World War I, for which the currency composition of reserves is known and security alliances proliferated, our results lend support to both hypotheses. We find that military alliances boost the share of a currency in the partner’s foreign reserve holdings by about 30 percentage points. These findings speak to the implications of possible US disengagement from global geopolitical affairs. In a hypothetical scenario where the United States withdraws from the world, our estimates suggest that long-term US interest rates could rise by as much as 80 basis points, assuming that the composition of global reserves changes but their level does not.

Greece’s third economic programme has been relatively successful, but before it can return to private market financing, the country will require more official debt relief. This column introduces a new CEPR Policy Insight which asks how much debt relief is required and how it should be delivered. Any debt relief package for Greece that wishes to avoid shifting the burden of repayment several generations into the future will need to include some degree of face-value debt relief.

Coronavirus Pandemic: Europe Is Once Again Forged in a CrisisTo an American, the debate around how the European Union should respond to the COVID-19 crisis has a familiar ring.Europe has been debating debt mutualization, transfer union and fi scal federalism for years.The pandemic is just another opportunity for sounding familiar themes.But the crisis is also a reminder that there is nothing distinctively European about this rhetoric.Closer to home (my home, anyway, where I am spending considerable time at the moment), we see southern state politicians like Florida Senator Rick Scott impugning northern states like New York for their profl igacy.Or, as President Trump put it on Twitter, "Why should the people and taxpayers of America be bailing out poorly run states (like Illinois, as [sic] example) and cities, in all cases Democrat run and managed, when most of the other states are not looking for bailout help?"Northern Europeans have no monopoly on such sentiments.Crises, wherever they occur, have a way of bringing out sectional divisions and reinforcing cultural stereotypes.

Abstract We analyze the ‘plurilateralization’ of global financial governance, defined as the proliferation of bilateral, regional and global governance arrangements, exploring how these have shaped international monetary and financial relations. We argue that the added layers of governance are the outgrowth of four factors: the demand for an international lender of last resort, the need to manage cross‐border financial and monetary policy spillovers, the desire for policy ownership and flexibility in an increasingly globalized world, and the confluence of bilateral liquidity provision policies with countries’ strategic foreign economic policy goals. Despite the desire to rationalize and streamline an increasingly complex international financial architecture, we argue that plurilateral governance is here to stay. We therefore offer some guidelines for living with this complexity.