Pandemics Depress the Economy, Public Health Interventions Do Not: Evidence from the 1918 Flu

Abstract

We study the impact of non-pharmaceutical interventions (NPIs) on mortality and economic activity across U.S. cities during the 1918 Flu Pandemic. The combination of fast and stringent NPIs reduced peak mortality by 50% and cumulative excess mortality by 24% to 34%. However, while the pandemic itself was associated with short-run economic disruptions, we find that these disruptions were similar across cities with strict and lenient NPIs. NPIs also did not worsen medium-run economic outcomes. Our findings indicate that NPIs can reduce disease transmission without further depressing economic activity, a finding also reflected in discussions in contemporary newspapers.

Note:
Funding Information: No funding or grant has been received for conducting the study.

Conflict of Interests: I declare no competing interest.

Keywords: 1918 Flu Pandemic, non-pharmaceutical interventions (NPI), real economy

JEL Classification: I10, I18, E32, H1