Economic Resilience: Fiscal Policy, Tourism, and ICT in COVID-19

Abstract

The COVID-19 pandemic crisis has brought about unprecedented economic and social consequences worldwide. The implementation of isolation measures, including national and international travel restrictions, significantly affected contact-intensive sectors such as tourism. Information and Communication Technology (ICT) was crucial during this lockdown period in maintaining connectivity and enabling remote activities. Governments worldwide implemented discretionary measures to mitigate the crisis's adverse effects on economic activity. This paper aims to analyse whether the level of ICT adoption and the importance of tourism influence the fiscal policy efforts pursued by governments. Based on the results of a linear regression analysis for 154 countries, the findings suggest that governments had to promote higher fiscal stimulus in countries with higher international tourism receipts. At the same time, ICT development diminished the efforts of the fiscal policy response to the crisis since it facilitated economic resilience. The findings of this study can contribute to understanding how governments responded to the pandemic crisis and the factors that influenced their fiscal policy decisions.