Covid-19 has highlighted huge weaknesses in our economic systems. New Scientist asked six leading economists how to redesign it to reduce inequality and save the planet
28 October 2020
THE coronavirus has unleashed an economic crisis of a kind never seen before. In just one month, from March to April, the US unemployment rate tripled to almost 15 per cent, and remains uncomfortably high. Elsewhere, only state intervention on a scale virtually unknown outside wartime has staved off the direst consequences. In the UK, gross domestic product (GDP), a measure of economic activity, fell by 20 per cent in the three months to June. To find another fall of that order, you must go back about 300 years.
The events of the past six months have brought to the boil arguments about the economy that have simmered since at least the 2008-09 financial crisis. While the size of the world’s economy has quadrupled since 1970, improving the material well-being of billions, the past decade has seen many people’s income stagnate and inequality rise (see “Failing system?”). During the covid-19 pandemic, it has become clear some of the most crucial jobs are being done by some of the lowest paid – people who are also among the most likely to die from the virus.
Meanwhile, the focus of conventional economics on growth at all costs is blamed for the ravaging of ecosystems that both made the pandemic more likely and its impact worse. All of this raises two questions: are our economic systems fit for the post-covid-19 era, and, if not, how must they change? New Scientist asked six leading economic thinkers for their take on how we got to where we are now, and how we might choose to do things differently.
Diane Coyle …