Mexico: the Great Depression and the Coronacrisis, 1929 and 2020
By contrasting the Great Depression and the Coronacrisis, we demonstrate that
narrative economics (Shiller, 2017) is key in the analysis of economic fluctuations. We note
the importance of the populist narrative to understand the economic and health outcomes
of the Coronacrisis in Mexico and highlight the role of the predominance of different
economic paradigms in economic policy decision-making. We suggest that, just as in 1929,
by following orthodox primary fiscal balance sheet policies at the cost of contracting
government investment, the Mexican economy will undergo a long and painful recovery
process compared to its global peers.
JEL Classification: B22; E02; E32; E62; E71.
Keywords: Narrative economics Coronacrisis Great Depression economic populism history of economic thought