Seize the day: opportunities and costs in the COVID-19 crisis

Abstract

Non-technical summary The thesis of this paper is that the COVID-19 crisis creates opportunities for fundamental change towards a more sustainable economy, for two reasons: structural change in the economy and a change in public opinion. The paper identifies how the COVID-19 crisis accelerates six processes of change that can be leveraged in policy making. With a focus on the Netherlands, it argues for activist government policy because of the tipping-point nature of the economic system in the crisis. Technical summary Structural change in the economy and a change in public opinion during the COVID-19 crisis jointly imply that government choices regarding investments, regulation and taxes can now create stronger synergies of cleaner economic growth and employment creation with ecological, social and financial sustainability. The paper details this for six areas, with examples taken from The Netherlands. High levels of private and (in some countries) public debt may become so unsustainable that this prompts a restructuring of financing systems which are more productive and more in support of ecological goals. In value chains, ICT systems and urban transport systems, forced changes such as more work from home, more cycling lanes and more local production may, once in place, be used as proof of concepts for permanently different infrastructures and organizations. Aviation and energy became dependent on public support, which created financial leverage for enforcing change. Social media summary COVID-19 creates opportunities for change towards sustainability as it accelerates six processes of change.