How did pandemic payments affect Americans and the US economy?

An Economic Impact Payment Card sent on behalf of the U.S. Department of the Treasury in place of a paper check for money received as a result of the COVID-related Tax Relief Act of 2020 pictured in Portland, Ore., on January 25, 2021. (Photo by Alex Milan Tracy/Sipa USA)No Use Germany.

The COVID-19 Economic Impact Payments were not the first time that the federal government has provided fiscal support to Americans during a crisis, but they did have a different purpose. The goal wasn’t to stimulate the economy but rather to offer “pandemic insurance”money to pay bills and buy food for people who may have lost income due to the pandemic. In the latest episode of the Brookings Podcast on Economic Activity, Hamilton Project Director Wendy Edelberg and MIT finance professor Jonathan A. Parker discuss Parker’s recent BPEA study on how those payments were spent (or not spent) and the on-going impact on the economy.