IDEAS home Printed from https://ideas.repec.org/p/sef/csefwp/568.html
   My bibliography  Save this paper

Pandemics and Local Economic Growth: Evidence from the Great Influenza in Italy

Author

Abstract

We investigate the link between the 1918 Great Influenza and regional economic growth in Italy, a country in which the measures implemented by public authorities to contain the contagion were limited or ineffective. The pandemic caused about 600,000 deaths in Italy, a death rate of about 1.2%. We find evidence of a strong and significant adverse effect of the pandemic on regional growth. In particular, going from regions with the lowest mortality to those with the highest mortality is associated to a decline in per capita GDP growth of about 6.5%, which dissipated within three years. In line with this finding, we also estimate a small and transitory negative effect of the influenza on industrialization. Our estimates provide an upper bound of the adverse effect of pandemics on local economic growth in the absence of non-pharmaceutical public-health interventions.

Suggested Citation

  • Mario F. Carillo & Tullio Jappelli, 2020. "Pandemics and Local Economic Growth: Evidence from the Great Influenza in Italy," CSEF Working Papers 568, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    • Handle: RePEc:sef:csefwp:568
    as

    Download full text from publisher

    File URL: http://www.csef.it/WP/wp568.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Havari, Enkelejda & Peracchi, Franco, 2017. "Growing up in wartime: Evidence from the era of two world wars," Economics & Human Biology, Elsevier, vol. 25(C), pages 9-32.
    2. Mario F Carillo, 2021. "Agricultural Policy and Long-Run Development: Evidence from Mussolini's Battle for Grain," The Economic Journal, Royal Economic Society, vol. 131(634), pages 566-597.
    3. Antonella Pinnelli & Paola Mancini, 1998. "Mortality Peaks in Italy in the Late 19th and Early 20th Centuries: Trends by Age and Sex," European Journal of Population, Springer;European Association for Population Studies, vol. 14(4), pages 333-365, December.
    4. Weil, David N., 2014. "Health and Economic Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 3, pages 623-682, Elsevier.
    5. Thomas A. Garrett, 2009. "War And Pestilence As Labor Market Shocks: U.S. Manufacturing Wage Growth 1914–1919," Economic Inquiry, Western Economic Association International, vol. 47(4), pages 711-725, October.
    6. Arnstein Aassve & Guido Alfani & Francesco Gandolfi & Marco Le Moglie, 2021. "Epidemics and trust: The case of the Spanish Flu," Health Economics, John Wiley & Sons, Ltd., vol. 30(4), pages 840-857, April.
    7. Douglas Almond, 2006. "Is the 1918 Influenza Pandemic Over? Long-Term Effects of In Utero Influenza Exposure in the Post-1940 U.S. Population," Journal of Political Economy, University of Chicago Press, vol. 114(4), pages 672-712, August.
    8. Robert J. Barro & José F. Ursúa & Joanna Weng, 2020. "The Coronavirus and the Great Influenza Pandemic: Lessons from the “Spanish Flu” for the Coronavirus’s Potential Effects on Mortality and Economic Activity," NBER Working Papers 26866, National Bureau of Economic Research, Inc.
    9. Karlsson, Martin & Nilsson, Therese & Pichler, Stefan, 2014. "The impact of the 1918 Spanish flu epidemic on economic performance in Sweden," Journal of Health Economics, Elsevier, vol. 36(C), pages 1-19.
    10. Marco Percoco, 2016. "Health Shocks and Human Capital Accumulation: The Case of Spanish Flu in Italian Regions," Regional Studies, Taylor & Francis Journals, vol. 50(9), pages 1496-1508, September.
    11. Amanda Guimbeau & Nidhiya Menon & Aldo Musacchio, 2020. "The Brazilian Bombshell? The Long-Term Impact of the 1918 Influenza Pandemic the South American Way," NBER Working Papers 26929, National Bureau of Economic Research, Inc.
    12. Brainerd, Elizabeth & Siegler, Mark V, 2003. "The Economic Effects of the 1918 Influenza Epidemic," CEPR Discussion Papers 3791, C.E.P.R. Discussion Papers.
    13. Robert J. Barro & José F. Ursua & Joanna Weng, 2020. "The Coronavirus and the Great Influenza Epidemic - Lessons from the "Spanish Flu" for the Coronavirus's Potential Effects on Mortality and Economic Activity," CESifo Working Paper Series 8166, CESifo.
    14. Paolo Malanima, 2018. "Italy in the Renaissance: a leading economy in the European context, 1350–1550," Economic History Review, Economic History Society, vol. 71(1), pages 3-30, February.
    15. Guido Alfani, 2013. "Plague in seventeenth-century Europe and the decline of Italy: an epidemiological hypothesis," European Review of Economic History, European Historical Economics Society, vol. 17(4), pages 408-430, November.
    16. repec:aei:rpaper:1008560098 is not listed on IDEAS
    17. Lembke B., 1918. "√ a. p," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 111(1), pages 709-712, February.
    18. Emanuele Felice, 2007. "I divari regionali in Italia sulla base degli indicatori sociali (1871-2001)," Rivista di Politica Economica, SIPI Spa, vol. 97(2), pages 359-406, March-Apr.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:hal:spmain:info:hdl:2441/7m2qa73prn89eogubjm0rc58le is not listed on IDEAS
    2. Arnstein Aassve & Guido Alfani & Francesco Gandolfi & Marco Le Moglie, 2021. "Epidemics and trust: The case of the Spanish Flu," Health Economics, John Wiley & Sons, Ltd., vol. 30(4), pages 840-857, April.
    3. De Santis, Roberto A. & Van der Veken, Wouter, 2020. "Macroeconomic risks across the globe due to the Spanish Flu," Working Paper Series 2466, European Central Bank.
    4. Guillaume Morel & Magali Jaoul-Grammare, 2023. "Do Pandemics Impact Macroeconomic Variables? A Cliometric Approach," Working Papers 01-23, Association Française de Cliométrie (AFC).
    5. Eric Bonetto & Guillaume Dezecache & Armelle Nugier & Marion Inigo & Jean-Denis Mathias & Sylvie Huet & Nicolas Pellerin & Maya Corman & Pierre Bertrand & Eric Raufaste & Michel Streith & Serge Guimon, 2021. "Basic human values during the COVID-19 outbreak, perceived threat and their relationships with compliance with movement restrictions and social distancing," PLOS ONE, Public Library of Science, vol. 16(6), pages 1-15, June.
    6. Battisti, Enrico & Alfiero, Simona & Leonidou, Erasmia, 2022. "Remote working and digital transformation during the COVID-19 pandemic: Economic–financial impacts and psychological drivers for employees," Journal of Business Research, Elsevier, vol. 150(C), pages 38-50.
    7. repec:spo:wpmain:info:hdl:2441/7m2qa73prn89eogubjm0rc58le is not listed on IDEAS
    8. Guillaume Chapelle, 2022. "The medium-term impact of non-pharmaceutical interventions. The case of the 1918 influenza in US cities," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 37(109), pages 43-81.
    9. Richard Franke, 2022. "Poverty, pollution, and mortality: The 1918 influenza pandemic in a developing German economy," Economic History Review, Economic History Society, vol. 75(4), pages 1026-1053, November.
    10. Anna Cororaton & Samuel Rosen, 2021. "Public Firm Borrowers of the U.S. Paycheck Protection Program [The risk of being a fallen angel and the corporate dash for cash in the midst of COVID]," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 10(4), pages 641-693.
    11. Davide Furceri & Siddharth Kothari & Longmei Zhang, 2021. "The effects of COVID‐19 containment measures on the Asia‐Pacific region," Pacific Economic Review, Wiley Blackwell, vol. 26(4), pages 469-497, October.
    12. Colvin, Christopher L. & McLaughlin, Eoin, 2020. "Death, demography and the denominator: New Influenza-18 mortality estimates for Ireland," SRERC Working Paper Series SRERCWP2020-2, University College Cork (UCC), Spatial and Regional Economic Research Centre (SRERC).
    13. Azomahou, Théophile T. & Ndung’u, Njuguna & Ouédraogo, Mahamady, 2021. "Coping with a dual shock: The economic effects of COVID-19 and oil price crises on African economies," Resources Policy, Elsevier, vol. 72(C).
    14. Théophile T Azomahou & Njuguna Ndung'U & Mahamady Ouedraogo, 2021. "Coping with a dual shock : the economic effects of COVID-19 and oil price crises on African economies," Post-Print hal-03344118, HAL.
    15. Michael König & Adalbert Winkler, 2021. "COVID-19: Lockdowns, Fatality Rates and GDP Growth," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 56(1), pages 32-39, January.
    16. Brian Beach & Karen Clay & Martin Saavedra, 2022. "The 1918 Influenza Pandemic and Its Lessons for COVID-19," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 41-84, March.
    17. Guillaume Morel & Magali Jaoul-Grammare, 2023. "Do Pandemics Impact Macroeconomic Variables? A Cliometric Approach," Working Papers of BETA 2023-01, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    18. Christian Møller Dahl & Casper Worm Hansen & Peter Sandholt Jensen, 2022. "The 1918 epidemic and a V‐shaped recession: evidence from historical tax records," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(1), pages 139-163, January.
    19. Aloysius Gunadi Brata & Eusebius Pantja Pramudya & Esther Sri Astuti & Heffi Christya Rahayu & Heronimus Heron, 2021. "COVID-19 and Socio-Economic Inequalities in Indonesia: A Subnational-level Analysis," Working Papers DP-2021-04, Economic Research Institute for ASEAN and East Asia (ERIA).
    20. Wim Naudé & Ricardo Vinuesa, 2020. "Data, global development, and COVID-19: Lessons and consequences," WIDER Working Paper Series wp-2020-109, World Institute for Development Economic Research (UNU-WIDER).
    21. Khemraj, Tarron & Yu, Sherry, 2020. "Human capital and the COVID-19 pandemic," MPRA Paper 101262, University Library of Munich, Germany.
    22. Giacomo Caracciolo & Salvatore Lo Bello & Dario Pellegrino, 2021. "An assessment on the potential impact of COVID-19 on the Italian demographic structure," Questioni di Economia e Finanza (Occasional Papers) 622, Bank of Italy, Economic Research and International Relations Area.
    23. Hou, Wenxuan & Li, Mao & Main, Brian G.M. & Liu, Xiaofan, 2023. "Pandemics and financial development: A lesson from the 1918 influenza pandemic," Journal of Corporate Finance, Elsevier, vol. 83(C).
    24. Ilan Noy & Tomáš Uher, 2022. "Economic consequences of pre-COVID-19 epidemics: a literature review," Chapters, in: Mark Skidmore (ed.), Handbook on the Economics of Disasters, chapter 7, pages 117-133, Edward Elgar Publishing.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Enrico Berbenni & Stefano Colombo, 2021. "The impact of pandemics: revising the Spanish Flu in Italy in light of models’ predictions, and some lessons for the Covid-19 pandemic," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 48(2), pages 219-243, June.
    2. Daniel de Kadt & Johan Fourie & Jan Greyling & Elie Murard & Johannes Norling, 2021. "Correlates and Consequences of the 1918 Influenza in South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 89(2), pages 173-195, June.
    3. Christian Møller Dahl & Casper Worm Hansen & Peter Sandholt Jensen, 2022. "The 1918 epidemic and a V‐shaped recession: evidence from historical tax records," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(1), pages 139-163, January.
    4. Daniel de Kadt & Johan Fourie & Jan Greyling & Elie Murard & Johannes Norling, 2020. "The causes and consequences of the 1918 influenza in South Africa," Working Papers 12/2020, Stellenbosch University, Department of Economics.
    5. Ilan Noy & Tomáš Uher, 2022. "Economic consequences of pre-COVID-19 epidemics: a literature review," Chapters, in: Mark Skidmore (ed.), Handbook on the Economics of Disasters, chapter 7, pages 117-133, Edward Elgar Publishing.
    6. Asli Demirgüç‐Kunt & Michael Lokshin & Iván Torre, 2021. "The sooner, the better: The economic impact of non‐pharmaceutical interventions during the early stage of the COVID‐19 pandemic," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 29(4), pages 551-573, October.
    7. Brian Beach & Karen Clay & Martin Saavedra, 2022. "The 1918 Influenza Pandemic and Its Lessons for COVID-19," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 41-84, March.
    8. Constantin Bürgi & Nisan Gorgulu, 2020. "Social Distancing and the Economic Impact of Covid-19 in the United States," CESifo Working Paper Series 8577, CESifo.
    9. Fenske, James & Gupta, Bishnupriya & Yuan, Song, 2022. "Demographic Shocks and Women’s Labor Market Participation: Evidence from the 1918 Influenza Pandemic in India," The Journal of Economic History, Cambridge University Press, vol. 82(3), pages 875-912, September.
    10. Yothin Jinjarak & Ilan Noy & Quy Ta, 2022. "Pandemics and Economic Growth: Evidence from the 1968 H3N2 Influenza," Economics of Disasters and Climate Change, Springer, vol. 6(1), pages 73-93, March.
    11. David E. Bloom & Michael Kuhn & Klaus Prettner, 2022. "Modern Infectious Diseases: Macroeconomic Impacts and Policy Responses," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 85-131, March.
    12. Howard Bodenhorn, 2020. "Business in a Time of Spanish Influenza," NBER Working Papers 27495, National Bureau of Economic Research, Inc.
    13. Richard Franke, 2022. "Poverty, pollution, and mortality: The 1918 influenza pandemic in a developing German economy," Economic History Review, Economic History Society, vol. 75(4), pages 1026-1053, November.
    14. Beniamino Callegari & Christophe Feder, 2022. "A Literature Review of Pandemics and Development: the Long-Term Perspective," Economics of Disasters and Climate Change, Springer, vol. 6(1), pages 183-212, March.
    15. Karlsson, Martin & Nilsson, Therese & Pichler, Stefan, 2012. "What Doesn't Kill You Makes You Stronger? The Impact of the 1918 Spanish Flu Epidemic on Economic Performance in Sweden," Working Paper Series 911, Research Institute of Industrial Economics.
    16. Ilan Noy & Toshihiro Okubo & Eric Strobl, 2023. "The Japanese textile sector and the influenza pandemic of 1918–1920," Journal of Regional Science, Wiley Blackwell, vol. 63(5), pages 1192-1227, November.
    17. Fraser Summerfield & Livio Di Matteo, 2021. "Influenza Pandemics and Macroeconomic Fluctuations in Recent Economic History," Working Papers 210002, Canadian Centre for Health Economics.
    18. Karlsson, Martin & Nilsson, Therese & Pichler, Stefan, 2014. "The impact of the 1918 Spanish flu epidemic on economic performance in Sweden," Journal of Health Economics, Elsevier, vol. 36(C), pages 1-19.
    19. Karlsson Martin & Matvieiev Mykhailo & Obrizan Maksym, 2023. "The Macroeconomic Impact of the 1918–19 Influenza Pandemic in Sweden," The B.E. Journal of Macroeconomics, De Gruyter, vol. 23(2), pages 637-675, June.
    20. Doran, Áine & Colvin, Christopher L. & McLaughlin, Eoin, 2024. "What can we learn from historical pandemics? A systematic review of the literature," Social Science & Medicine, Elsevier, vol. 342(C).

    More about this item

    Keywords

    Great Influenza; regional growth; mortality and growth;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sef:csefwp:568. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Maria Carannante (email available below). General contact details of provider: https://edirc.repec.org/data/cssalit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.