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The Economic Risks of Pandexit

Although everyone hopes that Pandexit, or the end of the COVID-19 pandemic, will come soon, the economic benefits will not be unalloyed. One plausible downside scenario is that current price pressures intensify and inflation rises further, eventually requiring a monetary response.

EDINBURGH – People have been using “exit” as a suffix for a decade or so. Grexit, referring to a potential Greek departure from the eurozone, was the first to emerge. Italexit made a brief appearance, and has recently been revived on the Italian right. But neither has come to pass. Nor has Frexit, or France’s unilateral withdrawal from the European Union. The far-right politician Marine Le Pen previously flirted with the idea, but then let it drop. And the only candidate in the 2017 French presidential election who advocated it, François Asselineau, won just 0.9% of the vote.

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