Pandenomics: How Covid-19 could change the world
We are nowhere near knowing when the Covid-19 pandemic will end or how bad things will really get. But the world may never be the same again. The pandemic will shake up not only healthcare, but politics and business, culture, society and our well-being. Combining several disciplines, we identify 15 shifts that may confront us over the coming years
1. Big government is back - Covid-19 has forced governments to intervene in the economy and daily life in a way unprecedented in peacetime. More changes will come after emergency lockdowns and support has ended.
2. Peak populism – populist politicians will push their nationalist agendas, pointing to the dangers of unbridled openness, but some countries may embrace a more focused internationalism to tackle global problems.
3. Competence matters - governments and companies that fail to show competence and compassion amid lost lives and livelihoods will rapidly lose trust and support. The recriminations may fuel ongoing conflict.
4. From monetary to fiscal - a further radical transformation of macro policy will casta long shadow. With fiscal rules cast aside, dealing with a massive build-up of debt willbe an enormous challenge.
5. Inequality matters – it’s not just a matter of fairness, it’s a matter of social stability and public health security. Society’s dependence on often low-paid and vulnerable people providing vital services is now in the spotlight.
6. ‘Too many to fail’ – pandemic lockdowns will lead to a shake-up in the servicesector, especially in high social contact areas such as leisure, which are dominated by small businesses, the low-paid and self-employed.
7. Collateral damage – government intervention in the financial system will continue. Beyond a rethink of how to keep financial markets functioning in future crises, a surge in insolvencies will leave a painful legacy.
8. Rethinking efficiency – the pandemic exposed the dangers of over-optimising processes, which leave little slack to deal with sudden setbacks. Instead of ‘just in time’, the ethos will shift to bigger ‘just in case’ inventories.
9. Rethink risk management – businesses will shift from linear thinking based on quantifiable risks based on past precedent to a new focus on mastering uncertainty with resilience and agility.
10. Rethinking supply chains – the fact that the pandemic emanated from China, the modern-day ‘workshop of the world’, exposed the vulnerability of global supply chains.
11. Expertise matters, and it needs to be diverse – on top of epidemiology, investments in science, both physical and social, will be needed to help inform difficult political, ethical and economic choices on future challenges.
12. War on disease – the huge human and economic toll of pandemics will push investments in health research and systems to the top of the agenda and add to the urgency of addressing other global threats to sustainability.
13. From physical to digital – sustained curbs on travel and enforced working from home during the pandemic will lead to a steep increase in people interacting digitally, radically shaking up the structure of the economy.
14. Lasting shifts in consumer behaviour and social norms – the mortal threat posed by social interactions has shifted our thinking about how we relate to our households, families, neighbours and communities.
15. More benign surveillance of individual health and social interactions – the benefits of tracking of personal health and our interaction with others may be reconciled with privacy and security by decentralised technology.