The impact of coronavirus on aggregate demand

The impact of coronavirus on aggregate demand
We take as our beginning stage a stripped-down form of the standard New Keynesian model
(Gali 2009). As in the Keynesian convention, employment and output are controlled by aggre-
gate demand. Thus, aggregate demand relies emphatically upon efficiency development. This
impact offers to ascend to a positive connection between efficiency development (g) and em-
ployment (l), delineated by the AD bend in Figure 1.
Short-run equilibrium Coronavirus
Long-run equilibrium - Coronavirus
Corona virus has acted a demand shock