Public equity stakes in companies impacted by the crisis
Some companies and sectors will need more than just the initial liquidity measures taken by governments. Direct ownership by the states is contemplated in several countries as part of the exceptional measures taken during the pandemic. This article released at Bruegel provides four guiding principles to ensure a good design of a hypothetical EU equity fund of companies affected by the covid-19 crisis.
The main idea behind these principles is to avoid a post-crisis world where "inefficient zombie firms feed on besieged taxpayers," and where the "single market" is seriously threatened. To that end the authors provide four principles to consider how and under what conditions support should be given: