Economic consequences of pre-COVID-19 epidemics: A literature review

In 2020, we all realized we should know more about the economic impacts of pandemics. Here, we summarize the contemporary research on the economic consequences of past epidemics and pandemics with a primary focus on highly infectious pathogens such as influenza and Ebola (as distinct from less infectious, but maybe ultimately more lethal or damaging diseases like AIDS). The paper draws exclusively from scientific research relating to events preceding the current COVID-19 crisis, though it does describe the many new studies completed recently in connection to the renewed scientific interest in past events. We do not focus on the on-going COVID-19 global crisis, since we believe it is premature to attempt to provide a thorough summary of our state of knowledge about this event. The economic consequences of epidemics are categorized into macroeconomic, microeconomic, socio-economic, sectoral and long-term impacts. Impact pathways and impact determinants relating to these effects are also described. This body of research suggests that epidemics have a broad range of inter-connected economic consequences through both supply and demand-side channels, with the behavioral response of individuals, communities, societies, and governments being one of the most important determinants of these impact (rather than disease prevalence and progression itself). Furthermore, the economic effects of epidemics can be long-lasting.