Prof. Larry Summers in an interview with Dan Senor: “COVID-19 to reinforce structural changes in the global economy”
Former U.S. Secretary of Treasury Prof. Larry Summers sheds light on the unprecedented changes to the economy that COVID-19 has spurred
As the world attempts to imagine what the day after COVID-19 may look like, esteemed economist Prof. Lawrence Summers—the former President of Harvard University, and the former U.S. Secretary of Treasury—sheds light on the unprecedented changes to our economies and societies that COVID-19 has spurred, if not accelerated.
From the state of capital markets, to the future of education and healthcare, Prof. Summers shared his assessment of this unique moment in history with investor Dan Senor, coauthor of bestselling book Start-Up Nation: The Story of Israel’s Economic Miracle, in the recent New Digital Age online conference, hosted by Start-Up Nation Central. The two spoke about the effects of COVID-19 on our economies and societies, to get a better understanding of what Prof. Summers calls “a hinge in history.”
“COVID-19 is unlike any other crises experienced in this century”
It is almost impossible to anticipate which of the moments that we live through will make the history books. From the 9/11 terrorist attacks to the 2008 financial crisis, there are obviously seminal moments already recorded in the 21st century, but where does COVID-19 fit into this picture? Prof. Summers asserts that COVID-19 is unlike any crises already experienced in the current century.
“The larger significance of COVID-19 is that it is going to reinforce what were already profound structural changes in the global economy,” he said at the conference. Some of the structural changes he names include a shift towards “more public sector orientation, and less support for the ideology of the individual market,” and a “profound acceleration of trends towards decentralization, associated with information technology.”
Many of these changes are accelerated by the nature of countries’ COVID-19 responses, namely testing and various containment mechanisms, which have brought to the forefront that “central public responsibilities simply cannot be met by decentralized markets,” according to Prof. Summers.
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