EpidemicsWhat Can the Black Death Tell Us about the Global Economic Consequences of a Pandemic?

By Adrian R. Bell, Andrew Prescott, and Helen Lacey

Published 4 March 2020

Concerns over the spread of the novel coronavirus have translated into an economic slowdown. A look back at history can help us consider the economic effects of public health emergencies and how best to manage them. In doing so, however, it is important to remember that past pandemics were far more deadly than coronavirus, which has a relatively low death rate. By far the worst death rate in history was inflicted by the Black Death. Caused by several forms of plague, it lasted from 1348 to 1350, killing anywhere between 75 million and 200 million people worldwide and perhaps one half of the population of England. The economic consequences were also profound.

Concerns over the spread of the novel coronavirus have translated into an economic slowdown. Stock markets have taken a hit: the U.K.’s FTSE 100 has seen its worst days of trading for many years and so have the Dow Jones and S&P in the U.S. Money has to go somewhere and the price of gold – seen as a stable commodity during extreme events – reached a seven-year high.

A look back at history can help us consider the economic effects of public health emergencies and how best to manage them. In doing so, however, it is important to remember that past pandemics were far more deadly than coronavirus, which has a relatively low death rate.

Without modern medicine and institutions like the World Health Organization, past populations were more vulnerable. It is estimated that the Justinian plague of 541 AD killed 25 million and the Spanish flu of 1918 around 50 million

By far the worst death rate in history was inflicted by the Black Death. Caused by several forms of plague, it lasted from 1348 to 1350, killing anywhere between 75 million and 200 million people worldwide and perhaps one half of the population of England. The economic consequences were also profound.

“Anger, Antagonism, Creativity’
It might sound counter-factual – and this should not minimize the contemporary psychological and emotional turmoil caused by the Black Death – but the majority of those who survived went on to enjoy improved standards of living. Prior to the Black Death, England had suffered from severe overpopulation.

Following the pandemic, the shortage of manpower led to a rise in the daily wages of laborers, as they were able to market themselves to the highest bidder. The diets of laborers also improved and included more meat, fresh fish, white bread and ale. Although landlords struggled to find tenants for their lands, changes in forms of tenure improved estate incomes and reduced their demands.

But the period after the Black Death was, according to economic historian Christopher Dyer, a time of “agitation, excitement, anger, antagonism and creativity”. The government’s immediate response was to try to hold back the tide of supply-and-demand economics.