Journal of Economic Literature
ISSN 0022-0515 (Print) | ISSN 2328-8175 (Online)
Modern Infectious Diseases: Macroeconomic Impacts and Policy Responses
Journal of Economic Literature
vol. 60,
no. 1, March 2022
(pp. 85–131)
Abstract
We discuss and review literature on the macroeconomic effects of epidemics and pandemics since the late twentieth century. First, we cover the role of health in driving economic growth and well-being and discuss standard frameworks for assessing the economic burden of infectious diseases. Second, we sketch a general theoretical framework to evaluate the trade-offs policy makers must consider when addressing infectious diseases and their macroeconomic repercussions. In so doing, we emphasize the dependence of economic consequences on (i) disease characteristics; (ii) inequalities among individuals in terms of susceptibility, preferences, and income; and (iii) cross-country heterogeneities in terms of their institutional and macroeconomic environments. Third, we study pharmaceutical and nonpharmaceutical policies aimed at mitigating and preventing infectious diseases and their macroeconomic repercussions. Fourth, we discuss the health toll and economic impacts of five infectious diseases: HIV/AIDS, malaria, tuberculosis, influenza, and COVID-19. Although major epidemics and pandemics can take an enormous human toll and impose a staggering economic burden, early and targeted health and economic policy interventions can often mitigate both to a substantial degree.Citation
Bloom, David E., Michael Kuhn, and Klaus Prettner. 2022. "Modern Infectious Diseases: Macroeconomic Impacts and Policy Responses." Journal of Economic Literature, 60 (1): 85–131. DOI: 10.1257/jel.20201642Additional Materials
JEL Classification
- E20 Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy: General (includes Measurement and Data)
- H50 National Government Expenditures and Related Policies: General
- I12 Health Behavior
- I14 Health and Inequality
- I15 Health and Economic Development
- I18 Health: Government Policy; Regulation; Public Health
- J17 Value of Life; Forgone Income