During the second wave of the pandemic, which was more lethal, collecting information on sector level stress became even more important for designing targeted policy interventions. The crisis thus created the opportunity to explore and harness the power of Big Data, and strengthen direct feedback mechanisms while working from home. 7. The pandemic also posed new research issues and analytical challenges for policy making.
These include: (i) whether the pandemic caused a demand shock or a supply shock, and which shock was transitory and which one durable; (ii) the size and nature of policy stimulus required, and their effectiveness; (iii) the relationship of national /localised lockdowns and vaccination with economic activity; (iv) the extent and nature of supply chain disruptions and its impact on inflation and growth; (v) the asymmetric impact of the shock/pace of recovery between contact-intensive services and manufacturing and agriculture; and (vi) the impact of the shock on household, corporate and financial sector balance sheets.