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The Epidemic Effect: Epidemics, Institutions and Human Capital Development

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Abstract

Epidemics can negatively affect economic development unless they are mitigated by global governance institutions. We examine the effects of sudden exposure to epidemics on human capital outcomes using evidence from the African meningitis belt. Meningitis shocks reduce child health outcomes, particularly when the World Health Organization (WHO) does not declare an epidemic year. These effects are reversed when the WHO declares an epidemic year. Children born in meningitis shock areas in a year when an epidemic is declared are 10 percentage points (pp) less stunted and 8.2 pp less underweight than their peers born in non-epidemic years. We find evidence for the crowd-out of routine vaccination during epidemic years. We analyze data from World Bank projects and find evidence that an influx of health aid in response to WHO declarations may partly explain these reversals.

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  • Francis Annan & Belinda Archibong & Uche Ekhator-Mobayode, 2023. "The Epidemic Effect: Epidemics, Institutions and Human Capital Development," Opportunity and Inclusive Growth Institute Working Papers 076, Federal Reserve Bank of Minneapolis.
    • Handle: RePEc:fip:fedmoi:96532
    DOI: 10.21034/iwp.76
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    More about this item

    Keywords

    Africa; World Bank; Disease; Aid; WHO; Epidemic; Vaccination;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • H84 - Public Economics - - Miscellaneous Issues - - - Disaster Aid
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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