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While the global economy will revert to some sort of normal as the effects of COVID-19 recede, the damage done will nonetheless cast a pall for years to come. In this sobering article, economists Òscar Jordà, Sanjay R. Singh and Alan M. Taylor look back at nearly seven hundred years of pandemics in Europe ​​​​​​and find that the crises’ financial effects persisted long after their health impacts subsided. While current demographic and medical circumstances differ from those in the past, the economic aftermath of COVID-19 may well be long and arduous.


COVID-19 will reshape the macroeconomic landscape for decades.

While the near-term effects of the coronavirus on trade, labor markets and output may recede to some degree as the public health threat diminishes, the pandemic’s longer term consequences will likely reverberate for many years. 

Economic growth could languish, and interest rates could reach new depths. Aggravating the problem is the high degree to which economies and markets are now integrated around the world. 

Pandemics exert a profound influence on interest rates.

About the Authors

Òscar Jordà, a senior policy adviser at the Federal Reserve Bank of San Francisco, is an economics professor at the University of California, Davis, where Sanjay R. Singh is an assistant professor of economics and Alan M. Taylor is a professor of economics and finance.

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