Modern Pandemics: Recession and Recovery

Abstract We examine the immediate and bounce-back effects from six modern health crises that preceded Covid-19. Time-series models for a large cross-section of economies indicate real GDP growth falls by around 2 percentage points in affected relative to unaffected year outbreak. Bounce-back is rapid strong, especially when compared non-health crises. Unemployment less educated workers higher exhibits more persistence, there significantly greater persistence female unemployment than male. Moreover, negative initial pandemics are economically contagious through international trade. The on felt with larger first-year responses government spending, care. Our estimates imply impact effect Covid-19 shock world approximately four standard deviations worse average past pandemic.