Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19
Although global economic activity is recovering and output in Europe and Central Asia (ECA) is expected to grow in 2021, containing COVID-19 remains a challenge in the region. Enterprise survey data for the emerging and developing countries in the region show that COVID-19 had a profound and heterog...
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2021
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| Online Access: | https://documents.worldbank.org/en/publication/documents-reports/documentdetail/856761633585748332/europe-and-central-asia-economic-update-fall-2021-competition-and-firm-recovery-post-covid-19 http://hdl.handle.net/10986/36296 |
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okr-10986-362962021-11-23T05:10:51Z Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 World Bank ECONOMIC GROWTH ECONOMIC OUTLOOK FISCAL TRENDS POVERTY RECOVERY POST-COVID-19 CORONAVIRUS COVID-19 COMPETITION CREATIVE DESTRUCTION ECONOMIC FORECAST ECONOMIC IMPACT GOVERNMENT SUPPORT PRODUCTIVITY FIRM PERFORMANCE Although global economic activity is recovering and output in Europe and Central Asia (ECA) is expected to grow in 2021, containing COVID-19 remains a challenge in the region. Enterprise survey data for the emerging and developing countries in the region show that COVID-19 had a profound and heterogeneous impact on firms. Smaller, younger, and female-run businesses were hit harder and had greater difficulty recovering. But the crisis also played a cleansing role and economic activity in ECA appears to have been reallocated toward more productive firms during the crisis, particularly in countries with more competitive markets. Firms with high pre-crisis labor productivity experienced significantly smaller drops in sales and employment than firms with low pre-crisis labor productivity and were also more likely to adapt to the crisis by increasing online activity and remote work. Many governments in ECA implemented broad policy support schemes to address the initial economic fallout from the crisis. Overall, this government support was more likely to go to less productive and larger firms, regardless of the level of their pre-crisis innovation. As economies enter the economic recovery phase, it will be important for policy makers in all countries to phase out broad policy support measures as soon as appropriate and focus on fostering a competitive business environment, which is key to a strong recovery, resilience to future crises, and sustainable, long-term economic growth. 2021-09-24T20:46:53Z 2021-09-24T20:46:53Z 2021-10-05 Serial https://documents.worldbank.org/en/publication/documents-reports/documentdetail/856761633585748332/europe-and-central-asia-economic-update-fall-2021-competition-and-firm-recovery-post-covid-19 978-1-4648-1802-8 http://hdl.handle.net/10986/36296 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank Washington, DC: World Bank Publications & Research Publications & Research :: Publication Europe and Central Asia Central Asia Europe Europe and Central Asia |
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Digital Repository |
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Foreign Institution |
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World Bank Open Knowledge Repository |
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World Bank |
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ECONOMIC GROWTH ECONOMIC OUTLOOK FISCAL TRENDS POVERTY RECOVERY POST-COVID-19 CORONAVIRUS COVID-19 COMPETITION CREATIVE DESTRUCTION ECONOMIC FORECAST ECONOMIC IMPACT GOVERNMENT SUPPORT PRODUCTIVITY FIRM PERFORMANCE |
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ECONOMIC GROWTH ECONOMIC OUTLOOK FISCAL TRENDS POVERTY RECOVERY POST-COVID-19 CORONAVIRUS COVID-19 COMPETITION CREATIVE DESTRUCTION ECONOMIC FORECAST ECONOMIC IMPACT GOVERNMENT SUPPORT PRODUCTIVITY FIRM PERFORMANCE World Bank Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
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Europe and Central Asia Central Asia Europe Europe and Central Asia |
| description |
Although global economic activity is recovering and output in Europe and Central Asia (ECA) is expected to grow in 2021, containing COVID-19 remains a challenge in the region. Enterprise survey data for the emerging and developing countries in the region show that COVID-19 had a profound and heterogeneous impact on firms. Smaller, younger, and female-run businesses were hit harder and had greater difficulty recovering. But the crisis also played a cleansing role and economic activity in ECA appears to have been reallocated toward more productive firms during the crisis, particularly in countries with more competitive markets. Firms with high pre-crisis labor productivity experienced significantly smaller drops in sales and employment than firms with low pre-crisis labor productivity and were also more likely to adapt to the crisis by increasing online activity and remote work. Many governments in ECA implemented broad policy support schemes to address the initial economic fallout from the crisis. Overall, this government support was more likely to go to less productive and larger firms, regardless of the level of their pre-crisis innovation. As economies enter the economic recovery phase, it will be important for policy makers in all countries to phase out broad policy support measures as soon as appropriate and focus on fostering a competitive business environment, which is key to a strong recovery, resilience to future crises, and sustainable, long-term economic growth. |
| format |
Serial |
| author |
World Bank |
| author_facet |
World Bank |
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World Bank |
| title |
Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
| title_short |
Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
| title_full |
Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
| title_fullStr |
Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
| title_full_unstemmed |
Europe and Central Asia Economic Update, Fall 2021 : Competition and Firm Recovery Post-COVID-19 |
| title_sort |
europe and central asia economic update, fall 2021 : competition and firm recovery post-covid-19 |
| publisher |
Washington, DC: World Bank |
| publishDate |
2021 |
| url |
https://documents.worldbank.org/en/publication/documents-reports/documentdetail/856761633585748332/europe-and-central-asia-economic-update-fall-2021-competition-and-firm-recovery-post-covid-19 http://hdl.handle.net/10986/36296 |
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1764484956453601280 |