What economists have learnt from the post-pandemic business cycle

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Science advances one funeral at a time, to paraphrase Max Planck. The Nobel prize-winning physicist was arguing that new ideas in his field would only catch on once the advocates of older ones died off. With a little adaptation he could have been describing the dismal science, too: economics advances one crisis at a time. The Depression provided fertile soil in which John Maynard Keynes’s theories could grow; the Great Inflation of the 1970s spread Milton Friedman’s monetarist ideas ; the global financial crisis of 2007-09 spurred interest in credit and banking. Sure enough, the recovery from the covid-19 pandemic...