The relation between an epidemic and world economy
Epidemics have been influencing our world since time immemorial, affecting all the living creatures. Nowadays, apart from those alive, they also make damage to a more abstract product of our activity, which is economic development. Depending on different circumstances, related to the very health issue or to the well-being of its coverage territories and states, the scope of damage varies; for example, “[r]ecent epidemics of HIV/AIDS (and the linked epidemic of TB) and SARS have had strong impacts on the wealth of households, businesses and, in some cases, entire economies” (Bloom & Canning, 2006, p. 26). Consequently, all the economies together construct a comprehensive system of world economy, which at times may suffer considerably from massive disease spreads.
Thus, having traced this relation, “[t]he number of economic impact studies in health has grown exponentially since the codification of a ‘cost-of-illness’ framework in the mid-1960s” (WHO, 2009, p. 2). With health issues influencing economy on a world-wide level (in such aspects, as working labor, budget re-planning, loans, tourism etc.), according initiatives also have developed, including “joint planning, information sharing, and financial support of a range of global efforts aimed at detection, verification, and response” (Marsh, 2008, p. 29) to epidemics.
Epidemic influence on world economy
First of all, every epidemic affects labor force, both specialized and not. Depending on the endurance of the issue and employment state of the country, economic consequence may be dreadful, as it causes “significant reduction in labor and capital utilization” (World Bank Group, 2014, p. 46). Furthermore, it also reduces individual’s possibility to purchase and consume good, which is of great damage for industries and economics. In the long run, such influences contribute to loss in GDP; for example, according to 2014 predictions on Ebola consequences, “in the High Ebola scenario, the GDP of West Africa is only 10 percent higher than its 2013 level by the end of 2015, while in the absence of Ebola it would have been 19 percent higher” (World Bank Group, 2014, p. 48), which is a rather tangible decrease.
With an epidemic being unpredictable and changeable, governments are under strong pressure to take unprofitable measures, which concern battling the disease. Thus, budget costs are re-allotted and comprehensive economic development faces immense obstacles, for instance, in form of credits or international debts. The issue is highly pressing for developing countries, which in case of an epidemic lose trust and interest of investors and may be left to their fate. However, there are now various “policies that enable the flow of relief and encourage commercial exchange (for health, business, and tourism purposes) with the affected countries, while also safeguarding partners from epidemiological contagion” (World Bank Group, 2014, p. 52) and such initiative groups as WHO, the United Nations and others, which may cover the expenses and balance the economy to a certain extent.
Another economic aspect covered by an epidemic is tourism, which virtually vanishes in case of a disease outburst. For those economies that depend largely on this industry (e. g., developing countries’ or islands’), an epidemic is especially harmful. As no clients arrive to consume goods and services, the economy becomes not only burdened with epidemic-related expenses and loss of labor, but also becomes stagnant in terms of it realization. In addition, tourists contribute to the spread if an infection, as “[f]requent travelers accelerate international spread if they are infected early and the outbreak does not otherwise expand rapidly” (Baker, 2015, p. 45). Thus, the population becomes threatened with both health and economic crises.
Epidemics and world economy are two phenomena that affect each other, with strong economy being able to reduce the impact of an epidemic; and with a powerful disease being able to cause delays in economy or even crush it. Deriving from this, a number of international organizations, initiatives, funds and volunteer groups were established.
The major economic problems, triggered by an epidemic are: disabled labor power; loss in GDP; relocation of budget funds, involving possible loans that delay economic development; significant damage to industry of tourism. Moreover, the weaker an economy is bade by ill health, the more difficult it becomes to restore a comprehensive well-being of a state or states.
All in all, epidemic influence may acquire massive scope if not approached properly and timely. International support, proper health care and access to medication would not only benefit the quality level of life in terms of health, but also would improve world economy as a whole.
Baker D. (2015). Tourism and the health effects of infectious diseases: are there potential risks for tourists? International Journal of Safety and Security in Tourism/Hospitality, 12(1), 41-59.
Bloom, D. E., Canning, D. (2006). Epidemics and economics. Program on the Global Demography of Aging. Retrieved from http://www.hsph.harvard.edu/program-on-the- global-demography-of-aging/WorkingPapers/2006/BLOOM_CANNINGWP9.2006.pdf
Marsh Inc. (2008). The economic and social impact of emerging infectious disease. New York: Marsh Inc.
World Bank Group. (2014). The economic impact of the 2014 Ebola. Epidemic short- and medium-term estimates for West Africa. Washington, D. C.: World Bank.
World Health Organization. (2009). WHO guide to identifying the economic consequences of disease and injury. Geneva: WHO.