Simulations of Policy Responses and Interventions to Promote Inclusive Adaptation to and Recovery from the COVID-19 Crisis in Zimbabwe

Date
2023-01Author
Mabugu, Ramos E.
Henseler, Martin
Makochekanwa, Albert
Maisonnave, Hélène
Chitiga, Margaret
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Abstract
We extend the broader macro-micro modelling literature on COVID-19 shocks by presenting
new evidence regarding estimated effects of mitigation and recovery policies on
macroeconomic and distributional effects in Zimbabwe. A novel feature in our model is an
emphasis on gender-disaggregated labor markets and distribution within a computable
general equilibrium model using a top-down approach. The main findings are that the effects
of the pandemic under both mild and severe scenarios were harsh on the economy and
worsened poverty and inequality. Poor and vulnerable populations, and women in particular,
were most affected through low earnings and savings, limited coping mechanisms, and
employment in exposed sectors. Responses in the form of mitigation and short-term economic
stimulus were effective in the short run but became unsustainable in the longer term,
highlighting the short-term versus long-term dilemma faced by the Zimbabwean government
when contemplating responses to COVID-19.