The Epidemic Effect: On the Politics and Economic Burden of Infectious Disease

Archibong, Belinda; Annan, Francis; Ekhator-Mobayode, Uche

Epidemics of infectious disease can have deleterious effects on economic development except mitigated through global health governance and domestic institutions. We investigate this hypothesis by examining the effects of sudden exposure to meningitis on economic outcomes using evidence from the meningitis belt in sub-Saharan Africa. Meningitis shocks reduce economic activity and child health outcomes in periods when the World Health Organization (WHO) does not declare an epidemic year. These effects are reversed when the WHO declares an epidemic year. A primary mechanism explaining the heterogeneity in results may be the influx of donor aid when the WHO declares an epidemic year. We document an increase in World Bank health aid projects approved during epidemic years. Areas that receive more health aid have more economic activity though health projects funded during epidemic years are rated relatively worse by independent evaluators. Domestic institutions influence resource distribution, with regions that are co-ethnic with the president having better outcomes than non-co-ethnic areas. The results are robust to extensive controls and using the timing of the Islamic Hajj to instrument for meningitis shocks.

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Academic Units
Economics (Barnard College)
Published Here
April 8, 2020