The Impact of the 1918 Spanish Flu Epidemic on Economic Performance in Sweden

We study the impact of the 1918 influenza pandemic on short- and medium-term economic performancein Sweden. The pandemic was one of the severest and deadliest pandemics in human history, but it hashitherto received only scant attention in the economic literature – despite representing an unparalleledlabour supply shock. In this paper, we exploit seemingly exogenous variation in incidence rates betweenSwedish regions to estimate the impact of the pandemic. The pandemic led to a significant increase inpoorhouse rates. There is also evidence that capital returns were negatively affected by the pandemic.However, contrary to predictions, we find no discernible effect on earnings.