Commentary: Good reasons for Thailand’s economic stimulus

Commentary: Good reasons for Thailand’s economic stimulus


That does not indicate that Srettha’s certain stimulus, as written, is properly designed. Payments to households that made up about 4 % of Americans ‘ personal income and could be deposited rather than spent right away, as well as policies ( from lockdowns to generous unemployment aid ) that reduced supply, led to high inflation during the pandemic era.

Srettha has suggested bills that could reach Thais ‘ quarterly per capita income, which would require quick and limited spending, in addition to a significant proposed minimum wage increase.

Giving a lot of money to poor rural areas with a quick expiration date ( over 140 per cent of pre-COVID monthly per capita income in the Isaan region ) and few places to spend it is a recipe for peculiar kinds of inflation.

However, these flaws may be addressed by lowering obligations to 5, 000 ringgit, staggered over a month with no “expiration” and no regional restrictions. Also, if commerce eventually recovers to post- COVID levels, the authorities would have more reason to minimize or further stagger payments.

Fraud is a risk, just like it is with infrastructure projects, and it’s not clear if authorities can create a payment system that is available to older and remote citizens. Tackling these problems will depend on the strength of Thailand’s parliamentary, criminal and media oversight.

American economists have frequently criticized Asian governments for undermining their customer and home sectors and rather encouraging investments and exports. Thailand’s government should be commended for trying to take the economic conditions of households significantly now, which it does deserve.

The Mossavar-Rahmani Center for Business and Government at Harvard Kennedy School is home to Richard Yarrow as a Fellow. In the summer of 2024, he may serve as a Visiting Fellow at Thammasat University. This remark initially appeared on the ISEAS- Yusof Ishak Institute’s website, Fulcrum.