The world economy is facing its second profound crises in less than two decades. Typically, seismic events such as the 2008 financial crisis or the Covid-19 pandemic have a transformative effect on political institutions, leading to a paradigm shift in policymaking. Talk of a paradigm shift in economic thinking had already begun after the 2008 financial crisis and are now louder than ever, particularly as the Covid-19 crisis has exposed the failings and shortcomings of existing orthodoxy and institutions. In this environment, governments are searching for new avenues in policymaking. Although the current crisis is still playing out, it has become increasingly clear that that the pandemic is causing a reordering of capitalism, however the direction of this transformation remains an open question.
According to some observers, Covid-19 marks the end of the neoliberal era, the logic of which had come to dominate economic policy making across the world since the 1980s. It has brought austerity policies to an abrupt end and globalisation to a sudden pause. Governments have been forced to discard their hands-off approach to the economy and reassert their authority in economic affairs in order to limit the economic and human damage resulting from the pandemic. Once-radical interventionist policies have come to the forefront of mainstream thinking. Analysts in policy circles and academia continue to discuss proactive government policies, including Keynesian-style fiscal stimuli, more effective redistribution, the dissolution of monopolistic firms, and stricter regulations regarding trade, finance, and labour. Discussions have even included once-radical ideas such as Universal Basic Income (UBI).
This session intends to discuss the following:
• What does the Covid-19 pandemic imply for the future of capitalism? Will countries do capitalism differently in the post-Covid-19 world? Does the pandemic mark the end of the neoliberal state? If so, what will its replacement look like?
• Can globalisation as we know it survive Covid-19? How can international trade be organised differently in order to avoid the fragilities exposed by the pandemic?
• How should we reform, if at all, international economic relations (trade, finance, investment), and institutions (IMF, WTO or World Bank)?
• Would a potential paradigm shift in economic policymaking be an opportunity for emerging economies?
• Is Covid-19 likely to deepen inequalities between and within countries or will the pandemic prove to be a great equaliser?