Economics of Pandemic Flu

March 23, 2007

The low level of public attention being focused on the prospect of pandemic flu continues to surprise, though it meshes with the ambivalence with which various government entities have been seeking to catch our interest.

The latest report on likely economic impacts is devastating: a 5.5% drop in US GDP. The model used was based on the experience of the 1918 pandemic, and assumed that this time around 2.2 million Americans would die, out of 90 million infected. With numbers like that in prospect (higher than some other somewhat rosier predictions) one can see why politicians are gun-shy and aspiring presidential candidates have not majored on a “Katrina in every state” scenario – yet.