Two-speed or three-speed recovery in post-COVID era: regional and sectoral development

Abstract

Sustainable and balanced recovery is a key factor to ensure the economic performance. Two-speed recovery pattern is already observed. Three-speed recovery represents the most likely pattern of recovery in majority in the EU countries in the post-COVID era due to the common dramatic decline in transport and tourism, relative minor impact on large part of essential manufacturing and services. It is believed that we will face large increase in air transport, minor increase in boomed courier and postal sector, and stability in other transport branches. The findings argue that urban areas are shocked more and modelled recovery scenarios reveal faster recovery compared to rural areas. Policy makers and government are encouraged to relocate and modify the recovery plans to stimulate balanced reginal recovery, reducing imbalances, rural-urban migration and rural-urban income inequality.