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Pandemics and income inequality: a historical review.

ABSTRACT: This paper examines the effects of pandemics on income inequality, specifically those pandemics that claimed more than 100,000 lives. Given that pandemics are events that rarely occur, we have use data spanning over the last 100 years (1915-2017) and relating to four pandemics. The study includes four countries that had income inequality data covering that period. Using panel data methods-fixed effects and augmented mean group estimators-we found a significant effect of these pandemics on declining income inequality. The study argues that based on the characteristics of the COVID-19 pandemic, namely that fatalities are highly concentrated in older age groups, we can neither expect a labor scarcity nor a sharp decline in productivity; however, we could expect a reduction in consumption, the possibility of savings, high unemployment rates, and high public debt ratios. The ultimate effects of COVID-19 on inequality remain unclear so far, as some of its inherent characteristics push for an increase in inequality. In contrast, others push toward a narrowing of the income gap.

Supplementary information

The online version contains supplementary material available at 10.1007/s43546-021-00059-4.

SUBMITTER: Sayed A

PROVIDER: S-EPMC7970770 | biostudies-literature | 2021

REPOSITORIES: biostudies-literature

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Pandemics and income inequality: a historical review.

Sayed Adham A Peng Bin B

SN business & economics 20210317 4

This paper examines the effects of pandemics on income inequality, specifically those pandemics that claimed more than 100,000 lives. Given that pandemics are events that rarely occur, we have use data spanning over the last 100 years (1915-2017) and relating to four pandemics. The study includes four countries that had income inequality data covering that period. Using panel data methods-fixed effects and augmented mean group estimators-we found a significant effect of these pandemics on declin ...[more]

PMID: 34778826

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Project description:The novel coronavirus is part of a series of infectious disease outbreaks that include: Ebola, Avian influenza, Middle East respiratory syndrome coronavirus, and Influenza A. This paper addresses the question of how do these epidemics and pandemics affect income inequality in countries around the world during the first two decades of this century. To achieve its objective, the paper develops a model that indicates a positive association between these health crises and income inequality. To empirically test our theoretical predictions, the paper explores the effect on the Gini coefficient of a dummy variable that indicates the occurrence of an epidemic or a pandemic in a country in a given year and the number of deaths per 100,000. To properly address potential endogeneity, we implement a Three-Stage-Least Squares technique. The estimation shows that the number of deaths per 100,000 population variable has a statistically significant positive effect on the Gini coefficient, especially when we incorporate COVID-19 data. This suggests that not only the occurrence, but also the health consequences of COVID-19 have a significant and economically important effect on income inequality.BackgroundThe purpose of the study is to examine the effect of epidemics and pandemics on income inequality. This has important implications as the outcome of this study can guide policymakers into implementing policies that can mitigate the economic consequences of these health crises.MethodsThe study is a cross country analysis using fixed effects estimation. To address potential endogeneity and determine causality, the paper uses the Three-Stage-Least-Squares estimation.ResultsThe paper finds that the number of epidemic deaths per 100,000 population variable has a statistically significant positive effect on the Gini coefficient, especially when we incorporate COVID-19 data.ConclusionsThe paper finds that it is not only the occurrence of an epidemic, captured by the epidemics dummy variable, but also the health consequences, captured by the number of deaths per 100,000 population, that have a significant effect on income inequality. This is especially the case when we incorporate COVID-19 in our analysis.Trial registrationNot Applicable.

Project description:The lack of a universally accepted definition of a pandemic hinders a comprehensive understanding of and effective response to these global health crises. Current definitions often lack quantitative criteria, rendering them vague and limiting their utility. Here, we propose a refined definition that considers the likelihood of susceptible individuals contracting an infectious disease that culminates in widespread global transmission, increased morbidity and mortality, and profound societal, economic, and political consequences. Applying this definition retrospectively, we identify 22 pandemics that occurred between 165 and 2024 AD and were caused by a variety of diseases, including smallpox (Antonine and American), plague (Justinian, Black Death, and Third Plague), cholera (seven pandemics), influenza (two Russian, Spanish, Asian, Hong Kong, and swine), AIDS, and coronaviruses (SARS, MERS, and COVID-19). This work presents a comprehensive analysis of past pandemics caused by both emerging and re-emerging pathogens, along with their epidemiological characteristics, societal impact, and evolution of public health responses. We also highlight the need for proactive measures to reduce the risk of future pandemics. These strategies include prioritizing surveillance of emerging zoonotic pathogens, conserving biodiversity to counter wildlife trafficking, and minimizing the potential for zoonotic spillover events. In addition, interventions such as promoting alternative protein sources, enforcing the closure of live animal markets in biodiversity-rich regions, and fostering global collaboration among diverse stakeholders are critical to preventing future pandemics. Crucially, improving wildlife surveillance systems will require the concerted efforts of local, national and international entities, including laboratories, field researchers, wildlife conservationists, government agencies and other stakeholders. By fostering collaborative networks and establishing robust biorepositories, we can strengthen our collective capacity to detect, monitor, and mitigate the emergence and transmission of zoonotic pathogens.

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Pandemics and income inequality: a historical review.

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Publications

Pandemics and income inequality: a historical review.

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