The Covid-19 has exposed huge weaknesses in our economic systems. New Scientist asked six leading economists how to rethink it to reduce inequality and save the planet
October 28, 2020
THE coronavirus has triggered an economic crisis of a kind never seen before. In just one month, from March to April, the unemployment rate in the United States tripled to almost 15% and remains uncomfortably high. Elsewhere, only state intervention on a scale virtually unknown outside of wartime has avoided the most serious consequences. In the UK, gross domestic product (GDP), a measure of economic activity, fell 20 percent in the three months to June. To find another such fall, you have to go back about 300 years.
The events of the past six months have boiled down arguments about the economy that have simmered since at least the 2008-09 financial crisis. While the size of the global economy has quadrupled since 1970, improving the material well-being of billions of people, the past decade has seen the incomes of many people stagnate and inequality rise (see “A Broken System?”). During the covid-19 pandemic, it became clear that some of the most crucial jobs are done by some of the lowest paid – people who are also among the most likely to die from the virus.
Meanwhile, the mainstream economics emphasis on growth at all costs is blamed for the ravaging ecosystems that both made the pandemic more likely and its impact worsened. All of this raises two questions: are our economic systems fit for the post-covid-19 era, and, if not, how should they change? New Scientist asked six great economic thinkers how we got to where we are today and how we might choose to do things differently.
Diane coyle is …