EXTRAORDINARY PERIODS AND PARADIGM SHIFTS IN ECONOMIC POLICIES: AN EVALUATION ON GLOBAL CRISES AND PANDEMICS


Özayrancı Y. E.

4th INTERNATIONAL ARTEMIS CONGRESS ON HUMANITIES AND SOCIAL SCIENCES, İzmir, Turkey, 3 - 06 June 2023, pp.157-158

  • Publication Type: Conference Paper / Summary Text
  • City: İzmir
  • Country: Turkey
  • Page Numbers: pp.157-158
  • Dokuz Eylül University Affiliated: Yes

Abstract

Throughout history, national economies have continually undergone transformation and encountered

various extraordinary periods. Global crises, pandemics, or natural disasters have shaken the foundations

of economies and necessitated the revaluation of economic policies. The impacts of these extraordinary

periods on economic policies have often profoundly influenced the dominant understanding, playing a

role in paradigm shifts.

Following the Great Depression of 1929, the Keynesian approach that was adopted transitioned into

monetarist economic policies with the oil crises of the 1970s, and the 1980s became a time when liberal

economic policies proliferated worldwide. Crises and pandemics, with the potential to fundamentally

change economic structures, are complex and impressive events. These periods typically expose the

flaws in existing economic policies and necessitate the discovery of new solutions. For instance, the

2008 global financial crisis necessitated steps towards improving financial regulations and intensifying

institutional oversight. Similarly, the Covid-19 pandemic questioned the resilience of national health

systems and how governments can intervene quickly in extraordinary situations.

In extraordinary situations, the inadequacy of existing economic policies necessitatesthe development

of new strategies, policy instruments, and approaches. These processes bring a new perspective to the

existing order. To mitigate the adverse effects of situations like crises and pandemics and to accelerate

economic recovery, governments use stimulus packages and financial support measures known

as emergency action plans. These kinds of policies become important tools to accelerate economic

recovery. Therefore, economic policies are reshaped thanks to these measures, and inevitable paradigm

shifts affecting subsequent periods occur. The importance and influence of economic policies during

extraordinary periods are decisive. Crises and pandemics in a sense provide a ground for revaluating

these policies and instigate paradigm shifts. Analysing the impacts of extraordinary periods on economic

policies based on past events and experiences and evaluating how future decisions may be shaped is of

great importance.

The study will first briefly discuss the impacts of extraordinary periods in history within the context

of economic crises and pandemics. Following this, a general evaluation will be conducted on the 2008

crisis and the Covid-19 pandemic, which are the most recent examples of the crises that constitute our

subject matter, comparing them in terms of their emergence and effects. Finally, the paradigm shift in

economic policies during extraordinary periods will be assessed, taking into consideration data from the

U.S. economy.