
Pandemics Depress the Economy, Public Health Interventions Do Not: 1918 Flu - lnguyen
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3561560
======
tathougies
This is ridiculous. Any economic effect of the 1918 flu is overpowered by the
end of WWI.

And the 1918 flu was followed by one of the most prosperous periods in
history: the roaring 20s.

The response to the 1918 flu was also not very centralized. Different states
and cities did different things, a strategy which is today being deplored by
the media and certain segments of the population. Since the response is
significantly more centralized today (entire states being shutdown, which has
not happened before), I'm not sure you can draw the same conclusions. It's one
thing to have one shutdown city in a country full of working cities. It's
quite another thing to have them all shut down at the same time, as well as
the entire world.

~~~
zzleeper
That's why the results are in relative terms. A city or state that is slow to
react will do worst than a faster or more effective one _in relative terms_.

About shutting down everything, yes. If absolutely no one works, then who
drives the trucks. But that's not what is happening today either.

------
Nuzzerino
The very title of this paper suggests a deeply flawed conclusion. A sample
size of one pandemic, from 100 years ago even, is used to generalize a
conclusion that "Pandemics Depress the Economy, Public Health Interventions Do
Not". Sure, there were multiple cities with varying levels of interventions,
but you can only conclude that in the 1918 economy for that specific pandemic,
the health interventions were good for the economy at that point in time.

I also agree with the other commenter that it may be better to see some
research prior to December 2019.

~~~
alex_young
Are you implying that we can’t draw conclusions from limited data sets? Surely
there must be some value in looking at the last event, even if it was 100
years ago...

~~~
tathougies
You have to think about confounding factors when considering only one event.
The effects of the 1918 flu are completely overshadowed by the end of WWI.
Thus you can't really draw many conclusions.

~~~
xapata
You can't control for that effect?

~~~
delecti
There's no control group for a single event.

~~~
itsdrewmiller
They are comparing different cities that both went through WWI ending, so I
think it would require a reason to believe WWI would affect different cities
differently to be a threat to validity. Certainly one could imagine there
might be such reasons and it is worth discussing them, but presumably that
would require looking at the specific cities in the paper which I presume no
one here (including me) has done.

~~~
tathougies
But it's not quite fair to compare two different cities in an economy where
only some cities are shut down. If New York shuts down but can still purchase
goods from LA, then that's a remarkably different situation than the entire
country being shut down, which is essentially what is going on now.

You cannot study the cities in isolation. They are not self-sufficient
economies. It's possible that one city was able to isolate because it depended
on the other cities to be working to receive its goods and to jump-start its
economy after the isolation. These effects cannot be ignored, and are
substantially different than today, when it's not just that most states are
shut down but also that most countries are shut down (well the ones of
economic significance, anyway).

~~~
xapata
But if the effect of WWI across different cities is random, and not correlated
with the explanatory variables, then the study can still work despite WWI
affecting the target variable. It'll just be part of the error term.

------
meowface
Are there any papers coming to a similar conclusion that were released prior
to December 2019? Just in case there's some bias from the current moment. Not
saying there's necessarily any evidence of such in this one, but it'd be
interesting to compare, at least.

~~~
cultus
Well, we are currently running a global experiment to find out whether it is
better for the economy to be negligent or have a robust public heath response
during a pandemic. We'll know soon.

~~~
baybal2
Different economies have different amount of money to loose. You can't compare
apples to oranges.

In China, which has way more to loose from the real economy going down, nobody
is running to sell their business now. A factory during a crisis, is still a
factory.

Now look how many people have cashed out in USA already, despite US economy
being much more virtual, and service based, and supposedly more resilient.

We are much more likely see whose economy is more resilient, and not whose
immediate response was better.

Panic factor? Chinese are by far more freaked out now than most Americans.
Even now, Americans trust their government more than Chinese to CPC.

Illiquid assets factor? No, you can sell a factory in China way faster than
you can sell a typical dotcom in America.

It's really just Chinese still looking up to seek more fortunes more than
American business people do, and America being way more vulnurable to panic
buy/sells.

And it's only the last point above, where an immediate response matters: In a
society more susceptible to mass panic among the business elites, you can
reduce the impact by increasing their confidence by showing competent early
response.

~~~
catalogia
It's not clear to me why a 'service-based' economy should be expected to
weather a pandemic better than a 'factory-based' economy. In the plants I've
worked in, you could clock in, do your work, then go home without ever talking
to anybody. The work was not particularly incompatible with social/physical
distancing. On the other hand, face-to-face human interaction is central to
much of the 'service-economy.'

------
anonsubmit2671
An ounce of prevention...

------
grillvogel
when did the spanish flu become the 1918 flu? was it in the past few days?

~~~
chillwaves
1918 Flu is a more accurate name and you seem to not have had any trouble with
the meaning, so what's the problem?

~~~
Nuzzerino
The problem is that it was being referred to as the Spanish Flu up until some
people in the media took offense to Trump's coining of the phrase "Chinese
Flu", so Spanish Flu needs to go if we're not wanting to look like hypocrites.

~~~
standardUser
I don't see how striving for consistency by avoiding nation-shaming labels is
a "problem". Trying to not be hypocritical is generally viewed as a good
thing.

~~~
catalogia
Revising terminology seems to run contrary to a strive for consistency.

~~~
standardUser
Tell that to World War I

------
guscost
And now the academy desperately tries to save face, as the COVID-19 pandemic
starts to wind down, and the consequences of all the panic _caused by the
academy_ start to play out. This year will be remembered as the end of modern
academia.

~~~
yibg
Is it winding down? Most of the US seems to be at early days of exponential
growth still. Only a handful of countries seem to have things under control
and even those places still have restrictions in place.

How are you concluding things are winding down?

~~~
guscost
It's my own prediction. Check back in a year, by which time SARS-CoV-2 will be
just another endemic strain of coronavirus.

~~~
irscott
What is your prediction based on? I really hope we're not still in this in a
year. I work in soho in NYC and still have to go and handle stuff at the shop
and the city is crazy right now.

~~~
guscost
“This” is looking more and more like a virus which is extremely contagious but
about as deadly as a bad cold. The author of the Imperial College study which
led to shutdowns in the UK and US recently revised his estimates and is now
saying that the R0 value (a measure of contagiousness) is higher than
previously thought, “just over three” is the latest. This would mean that
_lots_ of people have already been infected, and it’s not nearly as deadly as
everyone thinks.

The flip side is that we’d have a very hard time eradicating it, and if humans
can’t acquire permanent immunity it will be around basically forever, like
most other cold viruses.

~~~
yibg
But even if we assume it's no more deadly than a bad flu, doesn't it being
novel and hence no immunity at all in the population, give it a much higher
impact than the flu?

I mean regardless of the actual CFR and R0 value, we can take a look at Wuhan,
Spain, Italy and now increasingly likely NY to see the impact. I'm not an
expert but I don't think a bad seasonal flu overwhelms the local hospitals.
And this is with extraordinary measures being taken to boost hospital capacity
already.

~~~
guscost
> I don't think a bad seasonal flu overwhelms the local hospitals.

Happens all the time, most recently during the 2017-2018 season in parts of
the US: [https://time.com/5107984/hospitals-handling-burden-flu-
patie...](https://time.com/5107984/hospitals-handling-burden-flu-patients/)

Also keep in mind that COVID-19 would be quite a bit more contagious than the
flu (so it would spread more rapidly) if this theory is correct.

