Spanish Flu Was Awful But We Moved On Anyway

The temporary behavioral changes required to slow the propagation of the coronavirus entail real economic costs. These costs are difficult to evaluate given that the current situation is without recent precedent. Are there lessons to be drawn from the past that could enlighten us?

The answer is yes. There are three lessons to be drawn from economic history which could help us to better understand the current situation.

First, let’s analyze the case of a well-known pandemic that provoked an economic contraction, namely the Spanish influenza, which spread around the world toward the end of the First World War. Killing at least 50 million individuals in the span of a few months, the Spanish flu provoked a recession. The monthly U.S. data on industrial production and commercial activity suggest a drop of between 16% and 25% from July 1918 to March 1919. To put this in perspective, this is equivalent in terms of rapidity to the drop observed during the first four years of the Great Depression.

Συνέχεια ανάγνωσης εδώ

Πηγή: aier.org