No liquidity trap in Puerto Rico

Fewer than half of Puerto Rico’s bank branches and cash machines are up and running, still crippled by diesel shortages, damaged roads and severed communications lines. Bank officials say they are struggling even to find employees who can get to work when there is no public transportation and gasoline is hard to find.

Across the island, people who have spent their last dollars on an $8 bag of ice or $15 for gasoline are waiting for hours outside banks and A.T.M.s in hopes of withdrawing as much money as possible.

That is from Jack Healy at the NYT.  How about a literal helicopter drop of newly minted cash?

At a more general level, if the mainland were trying harder with its rescue efforts, where would the binding constraint be?  Here are a few possible candidates:

1. Port capacity

2. Ability to land helicopters

3. Ability of the helping forces to organize enough generators

4. Ability to fuel generators

5. Ability to rationally allocate food and other vital resources without enough money and decentralized markets

6. Ability to transport troops and other forces of assistance around the island

7. Data

8. Something else?


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