Coronavirus has had an extraordinary impact on economists’ efforts to communicate their analysis and research findings to the wider world. Working papers, blog posts and even books are contributing to our understanding of the Covid-19 crisis and how we should respond.
In the world of academic economics, there are strong incentives to write articles for peer reviewed journals. Among these, there is a narrow hierarchy, with the ‘top five’ general journals valued considerably above others, even leading journals for specific fields such as environmental or health or international economics. This narrow funnel and distorted incentive structure have been strongly criticised, including by economics Nobel laureates such as George Akerlof and James Heckman. Yet it is very resistant to change.
In 2020, however, the pandemic has had an extraordinary impact on economists’ efforts. The crisis has prompted a spontaneous collective effort by the economics profession to contribute both to the immediate policy response to the shock, and also to the debate about the character of the subsequent recovery. There are some similarities with the public service role that economists played in an earlier time of crisis – the Second World War (Coyle, 2020).
This Economics Observatory is one example of the surge in economic output. Another metric is the 60 submissions received by the Centre for Economic Policy Research (CEPR) for Covid Economics: Vetted and Real-Time Papers received in the publication’s first two weeks of existence, and it now has had dozens of issues. There have been many online conferences and seminars dedicated to exploring how to manage and mitigate the economic effects of the pandemic.
Many economists across the profession, from the most senior ranks down, have switched from their existing research to Covid19-related research, and have been swiftly publishing the results as working papers and in journal special issues. Some journals have published numerous Covid19-related papers, at a greatly accelerated pace compared with their usual timetable, implying a similarly responsive effort from reviewers.
Much of this work has been directed at other researchers, although the articles on this website are written for a broader audience of policy-makers and the public. Nevertheless, some economists are committed to public and policy engagement, and write for the wider audience. There have been scores of blog posts on the economic aspects of the pandemic and lockdowns (for example, VoxEU and other sites listed below).
Even some books published this year have had relevance, at least for how to shape the recovery from this crisis. Books have a far longer publication lag so most published this year were written before the authors had heard of coronavirus. But as there was a growing sense of unease about the outcomes of today’s capitalist market economies even before this year, crystallising into the demand to ‘build back better’ (Wdowin, 2020), quite a few recent books are relevant.
One prominent example is Deaths of Despair and the Future of Capitalism by Anne Case and Angus Deaton. They document the unfolding disaster in US health and life expectancy due to deaths from opioid overdoses, suicide and alcoholism. US life expectancy has actually been declining since 2014, in a grossly unequal way, affecting those with no education beyond high school, and getting worse faster for white people. The pandemic is worsening all health inequalities in the United States.
Economists are also engaged in debate about what needs to change. Martin Sandbu’s The Economics of Belonging, like Deaths of Despair, focuses on people and places that have been ‘left behind’ by economic growth this century, and proposes a range of policies from more education spending to a higher minimum wage and universal basic income to narrow the gap.
The title of Angrynomics by Mark Blyth and Eric Lonergan hints at their view that the way the economy has evolved since at least the financial crisis – in fact, they argue, since the late 1980s – has generated anger among those who have not benefited. Their policy proposals focus on regulation to make markets deliver fairer outcomes.
Some recent books have focused on the absence of competition and increasing concentration in markets such as technology, finance and pharmaceuticals to account for both slower economic growth and increasing inequality. Michelle Meagher gives a lawyer’s perspective in her combative Competition is Killing Us, the central message of which is given by its subtitle: how big business is harming our society and what to do about it.
Thomas Philippon in The Great Reversal demonstrates that the US economy has become meaningfully less competitive, leading to higher prices, lower wages and lower productivity. He argues that the main explanation is regulatory capture – the extraordinary scale and effectiveness of corporate lobbying in the United States.
Dietrich Vollrath’s Fully Grown takes a longer historical perspective on the slowdown in growth in most OECD countries since the turn of the century – and has a less gloomy message. There is population ageing, the result of economic success in delivering health gains and lower fertility rates due to reduced infant mortality and higher incomes. Economies have also increasingly featured services, where productivity growth is typically slow, rather than manufacturing or agriculture.
There is a vigorous debate among economists about whether or not the pace of innovation and hence productivity growth is really slowing. If the slow growth story is correct, it will make recovering from the pandemic even more challenging. Many are now arguing that future GDP growth can be boosted by investment in green technologies (Castle and Hendry, 2020) or the creation of a national investment bank (Besley et al, 2020).
It is clear that at least in the short term, generating growth will be imperative for reducing unemployment and helping businesses to recover and invest. The debate about how to reshape the economy more fundamentally is likely to continue longer-term – and economic researchers will need to continue engaging in the public debate.
Where can I find out more?
- The Enlightened Economist: Over a decade’s worth of Diane Coyle’s reviews of economics and business books – and occasional forays into other areas.
- The 2020 Enlightened Economist Prize longlist: Diane Coyle’s picks of books published in 2020, including the winner: Boom and Bust: A Global History of Financial Bubbles by William Quinn and Observatory lead editor John Turner.
- Extreme Economies: Summary of recent book by Observatory director Richard Davies.
Other selections of favourite books on economics and related areas:
- Martin Wolf’s picks in the Financial Times.
- Books of the year chosen by The Economist.
- Websites featuring economists writing about coronavirus and the economy include the Institute for Fiscal Studies, the National Institute of Economic and Social Research and LSE blogs.
- Bristol Festival of Economics, founded by Diane Coyle and now co-directed with Richard Davies, featured a number of discussions of Covid-19-related topics in its November 2020 virtual incarnation, including big government, ‘levelling up’, radical uncertainty, the arts, food supply and ‘building back better’.
- CoronaNomics: A series of videos made by Econ Films, who also worked with the Observatory on video content.