Departmental Papers

The post-GFC era has marked a transition from the relative stability of the “Great Moderation” to a more volatile “Great Turbulence,” characterized by structural transformations, frequent shocks, heightened uncertainty, and constrained policy space. This paper examines whether existing macroeconomic policy frameworks remain fit for purpose in the face of four major global trends—demographic change, climate change, geoeconomic fragmentation, and artificial intelligence. It concludes that credible, resilient, and well-coordinated policy frameworks will be essential to preserving domestic and external stability in an increasingly shock-prone world.