Pandemics have had an interesting impact on economics throughout history. While most “experts” predict doom and gloom, there is another possibility. Depending upon your economic status, it may be bad or not.
Many times when a plague hit, predictably it was the poor who bore the brunt of it, with many dying. The Black Plague, for example, has been estimated to kill one-third of Europe’s population.
When the plague abated and businesses tried to recover, the decimation of the lower class meant that there were fewer laborers available. Although many could return to their old jobs at their old wages, other businesses, desperate for workers, offered significantly higher wages to lure them away from their old employer. In some cases, they were offered two to three times as much as they had earned in the past.
The wealthy found some of these changes alarming. In the words of an anonymous English chronicler: “Such a shortage of labourers ensued that the humble turned up their noses at employment, and could scarcely be persuaded to serve the eminent for triple wages.”
The response from the wealthy was predictable. In one case, “the wealthy lobbied the English crown to pass the Ordinance of Labourers, which informed workers that they were ‘obliged to accept the employment offered‘” for the same measly wages as before.’ This was largely ignored, of course. It would require a violent suppression to force compliance. Over the years, some societies did just that.
In the meantime, landlords were facing an oversupply of real estate and a shortage of potential tenants. Prices were lowered, and the lucky elites managed to survive on their wealth rather than relying on their income. It is debated, bot possible, that these events created the middle class.
We can only wait to see if the aftermath of the COVID-19 pandemic has such an effect. I suspect that will be a while, since the unvaccinated provide a breeding ground for the virus to mutate. When this occurs, the original and the weaker variants are stopped while the stronger survive and will likely be harder to combat.
Many of the ideas and the quotes in this blog are based upon the writings of Walter Scheidel, Professor of Classics and History at Stanford University, and the author of The Great Leveler: Violence And The History Of Inequality From The Stone Age To The Twenty-First Century.