The recently passed Coronavirus Relief package increased unemployment benefits by granting $600 a week (up to...

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Economics

The recently passed Coronavirus Relief package increasedunemployment benefits by granting $600 a week (up to 4 months) toan unemployed individual, plus the normal unemployment benefit theywould be entitled to (max $360 in Michigan); extended the durationof unemployment benefits another 13 weeks; makes former workerseligible (you need not have been laid off due to the pandemic). Allof it is federally funded. Was this a good idea? What affects mightthere be on the labor markets? On the economy?Â Â

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The huge increase in the benefits to the unemployed will definitely impose great fiscal deficits for the US government and pose a challenge to long term growth once the pandemic is taken care of All else equal US would be on the long path of austerity post the pandemic to cover for the increased See Answer

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