Stock market plunge should incentivize firms to develop a coronavirus cure

Stock market plunge should incentivize firms to develop a coronavirus cure

Linda Cohen UCI professor of economics and law and Amihai Glazer, UCI professor of economics and director of the Program in Corporate Welfare at the University of California, Irvine write, “The U.S. government should take advantage of the recent stock market plunge to incentivize firms to develop a coronavirus cure, vaccine, or other approaches. We call this proposal the Epidemic Market Solution or EMS. The government should offer each of 10 firms stock options worth ten billion dollars if the Dow Jones increases by 15 percent over the next six months, and maintains that average increase over a month. A coronavirus cure or vaccine would generate such an increase.”