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Pandemics and Protectionism: Evidence from the “Spanish” flu

Author

Listed:
  • Boberg-Fazlic, Nina

    (University of Southern Denmark)

  • Lampe, Markus

    (WU Vienna University of Economics and Business, CEPR)

  • Pedersen, Maja Uhre

    (University of Southern Denmark)

  • Sharp, Paul

    (University of Southern Denmark, CAGE, CEPR)

Abstract

The impact of COVID-19 on recent tendencies towards international isolationism has been much speculated on but remains to be seen. We suggest that valuable evidence can be gleaned from the “Spanish” flu of 1918-20. It is well-known that the world fell into a protectionist spiral following the First World War, but scholars have almost exclusively ignored the impact of the pandemic. We employ a difference-in-differences strategy on data for Europe and find that excess deaths had a significant impact on trade policy, independent of the war. A one standard deviation increase in excess deaths during the outbreak implied 0.022 percentage points higher tariffs subsequently, corresponding to an increase of one third of a standard deviation in tariffs. Health policy should aim to avoid the experience of the interwar period and consider the international macroeconomic impact of measures (not) taken.

Suggested Citation

  • Boberg-Fazlic, Nina & Lampe, Markus & Pedersen, Maja Uhre & Sharp, Paul, 2020. "Pandemics and Protectionism: Evidence from the “Spanish” flu," CAGE Online Working Paper Series 479, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:479
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    Cited by:

    1. Sofia Teives Henriques & Paul Sharp & Xanthi Tsoukli & Christian Vedel, 2021. "Resilience, Adaptability and Transformability:Danish Butter Factories in the Face of Coal Shortages," CAGE Online Working Paper Series 598, Competitive Advantage in the Global Economy (CAGE).
    2. Ivan Montiel & Junghoon Park & Bryan W. Husted & Andres Velez-Calle, 2022. "Tracing the connections between international business and communicable diseases," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(8), pages 1785-1804, October.

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    More about this item

    Keywords

    Pandemics; protectionism; trade JEL Classification: F13; I19; N74;
    All these keywords.

    JEL classification:

    • I19 - Health, Education, and Welfare - - Health - - - Other
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • N74 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: 1913-

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