What does economics have to do with healthcare? Dr John Tang, Senior Lecturer in Economics, explains how the study of economic history can help us understand the problems of today, including the spread of infectious diseases like COVID-19.
“COVID-19, aka the coronavirus is a very contagious disease, so it is no surprise that many people are trying to figure out how to stop it. Preferably sooner rather than later. Aside from the health impact there are also many economic consequences – job losses, increased public spending, even disrupted schooling,” says Dr Tang.
“Most people would like to know when things will go back to normal. This is where economic history can help.”
What is economic history?
Economic history is the study of economic issues from an historical perspective. When you think of any current economic phenomenon, for example trade or financial markets, you can often find an equivalent in the past, in many different countries.
Economic historians examine these phenomena to explore diverse questions from why certain countries are rich or poor to how an invention can impact gender roles.
“One of the most useful things about economic history is how we can use it to understand our economic present,” explains Dr Tang.
How can economic history help us understand COVID-19?
COVID-19 is a new disease, with many uncertain variables and consequences. That doesn’t mean there aren’t past experiences we can use to inform how we handle the coronavirus and its impact on the community.
Economic history can help us to examine past pandemics such as SARS and the Spanish flu. By using economic history to study past pandemics we can utilise years, decades or even centuries of data to understand the possible effects of COVID-19 and how to manage its presence effectively.
For example, social distancing. “We understand the benefits of social distancing because similar practices worked more than 100 years ago during the 1918 flu pandemic,” says Dr Tang.
What is the link between transport and infectious disease?
When you consider how easy it is to move around Melbourne – you can hop on a tram and be out of the city within an hour – it’s unsurprising infections spread so quickly explains Dr Tang.
Now imagine you’re living in a time before scientists understood germ theory and the existence of viruses, how do you stop something that’s invisible?
Dr Tang demonstrates this ‘invisible’ link between transport and infectious disease with the introduction of the railway network to 19th century Japan.
The rail network allowed for rapid movement of people and goods in Japan, as well as global export helping it to become an industrial economy. Greater integration of the community also had an unexpected consequence – higher mortality rates in regions with a railway line. This was true until the entire country was connected by trains.
In order to rule out additional factors such as dangerous work conditions or traffic accidents that went along with the increase in transport, Dr Tang separated all the different ways people died and categorised them by infectiousness.
If his hypothesis was correct, trains carried people and people carried diseases, then deaths from heart failure or cancer shouldn't rise by the same amount as deaths from pneumonia or tuberculosis when a railway was introduced.
“I was testing whether trains were the vector of transmission by comparing infectious versus non-infectious mortality rates,” explains Dr Tang.
“I found that it was indeed the case that areas with railways not only had more deaths, but deaths from infectious diseases were much higher than others.”
“That was an unintentional trade-off the government made, faster economic growth through investment in trains, but also higher mortality rates from infectious diseases. It's something to think about when governments rush to re-open their economies or borders (post COVID-19) and don't consider some of the short and long run consequences.”
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