Economic disasters are not only caused by poor regulation of financial markets, anti-market government policies or wars. There are other causes that are even more difficult to manage. Nassim Taleb, who has become a world celebrity, writes about “black swans” – events that happen extremely rarely and that have a significant impact on the economy. Just three years ago, for example, a 30% drop in US real estate prices seemed like a fantasy, and it was almost impossible to predict that the stock market capitalization would fall by half. Although Taleb is credited with popularizing “black swans”, modern macroeconomists such as Robert Barro from Harvard have long studied the impact of such events. One possible “black swan” is the likelihood of a global epidemic. It is not surprising that economists, governments and financial markets studied the situation with bird flu in detail several years ago, and are now watching the spread of swine flu with great concern. After all, a global epidemic could worsen the financial crisis or hinder the nascent process of global economic recovery.

What do economists know about the possible consequences of a global epidemic? Unfortunately, very little. The best studied is the Spanish flu pandemic of 1918–1919. This epidemic was one of the most terrible in human history: 20% of the world's population was infected, 2.5–5% of those infected died, and the disease claimed a total of 50 million people (0.5–1% of the world's population). Only two other pandemics exceeded the death toll from the Spanish flu: the Plague of Justinian (peaked in 540–544, 100 million victims, from a quarter to half of the world's population) and the Black Death (1347–1351, 60 million victims).

The Spanish flu pandemic caused serious economic losses. The mortality rate depended on age in a W-shape, i.e. there were two mortality peaks – the risk group included not only children and the elderly (as with the common flu), but also men of working age – 18–40 years old.

In a 2007 paper, economist Thomas Garrett of the Federal Reserve Bank of St. Louis provides an interesting collection of excerpts from 1918 newspaper articles on the economic impact of the Spanish flu. For example, the Arkanzas Gazette of October 18, 1918, wrote: “Trade <...> has fallen 40%. Some estimates say it has fallen 70%. The only business <...> that is thriving is the drugstore.” And the Commercial Appeal of the same day paints an even bleaker picture: “Coal output has fallen 50%. Mines are on the verge of closing because of epidemics in the mining camps. In [the town of] Coalfield, Tennessee <...> only 2% of the population is healthy.”

Robert Barro and Harvard graduate student Jose Ursua provide more accurate statistics in their study of economic disasters of the 20th century. According to them, the Spanish flu is the fourth most significant disaster of the century (after World War II, World War I, and the Great Depression). On average, the decline in GDP from peak to trough in real terms was 6.6%. Long-term economic losses from influenza are also significant. Economist Doug Almond from Columbia University studied the impact of the epidemic on children conceived or born during the epidemic. It turned out that “children of the epidemic” were significantly more likely to get sick in later life, they have a higher probability of serious medical problems - schizophrenia, diabetes, and stroke. All other things being equal, their probability of completing high school was 15% lower than that of their peers, their salaries were 5-7% lower. In other words, the long-term effects of pandemics on human capital are very significant.

One could, of course, argue that the experience of studying the 1918 epidemic is not relevant when analyzing today's problems. After all, the speed of the disease's spread was associated with the mass movement of soldiers after the First World War. Back then, there were no antiviral drugs to treat influenza or antibiotics to combat complications, people were poorer, had worse nutrition, and the risk of infection was therefore much higher than today. But let's remember the aggravating factors of today: the infection is now spreading even faster, because the world has become even more globalized. A transatlantic flight takes only 10 hours, while in 1918 it took weeks to cross the ocean. Many more people live in cities, and population density increases the speed of infection. And the number of antiviral drugs is very limited.

What could be the losses from a new global flu pandemic? The World Bank estimates that it would cost the global economy $800 billion, and the death toll could be in the tens of millions. Researchers from the Centers for Disease Control (the most authoritative US organization on this issue) used a mathematical model of the spread of influenza and estimated only the initial losses for the US economy at $166 billion (approximately 1.3% of GDP), and the death toll could reach 207,000 people. The US Department of Health and Human Services is even more pessimistic: 1.9 million victims in the US and costs of $200 billion. If you take into account the cost of human life, the consequences of the pandemic could significantly exceed the losses from the financial crisis.

Unfortunately, if the epidemic really does develop into a global pandemic, it will hit Russia especially hard. First, Russia will have to spend huge resources to fight the disease. So far, the plan to combat a possible epidemic has not been published and it is not possible to estimate the amount of expenses. But they will be significant. However, the main problems will be related to the fact that during the pandemic, global demand for oil will decrease significantly. After all, tourism and the transport sector suffer most from pandemics. Therefore, it is quite possible that today's oil prices will seem unattainably high to us. If the fall in oil prices to $40-50 per barrel led to serious problems for the Russian budget, then what can we say about a further decline in prices. We can only hope that "the pig won't eat it".

Ratio economica: The Economics of the Plague