Dealing with any crisis has two rather distinct phases: A first phase that addresses the acute emergency situation and a second phase that aims at getting the system back on track to the old (or new) normal. While the first phase does not allow much room for long-term considerations, the second phase requires a more strategic approach. Political decisions about the way forward have to weigh short-term and long-term consequences. Trade-offs may be faced between the speed of economic recovery and the resilience of the system against future crises. This not only holds with respect to the design of recovery packages but also on a more conceptual level.
In addressing these challenges, the extent to which climate policy enters current actions plays a major role. Stimulus packages might create new path dependencies that perpetuate future risks, or they can help path the way to a more sustainable future. Are there lessons to be learnt from past crises? Is intervention needed or even desirable in the current situation? What principles should guide policy makers in their decisions? It is these questions that Karen Pittel will address in her talk.
Prof. Dr. Karen Pittel is Director of the Center for Energy, Climate and Resources at ifo Institute, Munich and Professor of Economics at the University of Munich