Understanding Crises - What to take from here for better policy advice in the future?
Exploring Economics, 2021
The world is regularly shaken by crises: some are bigger, others are smaller in scope. Local turmoil, military conflicts, commodity scarcity, bank runs, health threats - the history of mankind can be written as a history of crises. Three major global crises occurred in the last fifty years alone: the oil crisis in 1973, the financial crisis 2008 and the corona pandemic 2020/2021. However, mainstream economics does not seem to pay much attention to them. Crises are thought of as external effects which just randomly interfere with the models used. This conflicts with real life experience when crises have massive consequences on jobs, education opportunities, prosperity, and health of millions of people. Two renowned economists will share their expertise about how to understand crisis phenomena and which crisis response measures work. They will also discuss how economics needs to change to appropriately reflect crises and their real life consequences in theory building. Since to build a more resilient and sustainable economy driving development around the globe, new approaches, models and policy advice will be needed.