What can the Black Death tell us about the global economic consequences of a pandemic?

March 3, 2020

Concerns over the spread of the novel coronavirus have translated into an economic slowdown. Stock markets have taken a hit: the UK’s FTSE 100 has seen its worst days of trading for many years and so have the Dow Jones and S&P in the US. Money has to go somewhere and the price of gold – seen as a stable commodity during extreme events – reached a seven-year high.

A look back at history can help us consider the economic effects of public health emergencies and how best to manage them. In doing so, however, it is important to remember that past pandemics were far more deadly than coronavirus, which has a relatively low death rate.

Without modern medicine and institutions like the World Health Organization, past populations were more vulnerable. It is estimated that the Justinian plague of 541 AD killed 25 million and the Spanish flu of 1918 around 50 million

By far the worst death rate in history was inflicted by the Black Death. Caused by several forms of plague, it lasted from 1348 to 1350, killing anywhere between 75 million and 200 million people worldwide and perhaps one half of the population of England. The economic consequences were also profound.
‘Anger, antagonism, creativity’

It might sound counter-factual – and this should not minimise the contemporary psychological and emotional turmoil caused by the Black Death – but the majority of those who survived went on to enjoy improved standards of living. Prior to the Black Death, England had suffered from severe overpopulation.

Following the pandemic, the shortage of manpower led to a rise in the daily wages of labourers, as they were able to market themselves to the highest bidder. The diets of labourers also improved and included more meat, fresh fish, white bread and ale. Although landlords struggled to find tenants for their lands, changes in forms of tenure improved estate incomes and reduced their demands.

But the period after the Black Death was, according to economic historian Christopher Dyer, a time of “agitation, excitement, anger, antagonism and creativity”. The government’s immediate response was to try to hold back the tide of supply-and-demand economics.

Life as a labourer in the 14th century was hard. British Library

This was the first time an English government had attempted to micromanage the economy. The Statute of Labourers law was passed in 1351 in an attempt to peg wages to pre-plague levels and restrict freedom of movement for labourers. Other laws were introduced attempting to control the price of food and even restrict which women were allowed to wear expensive fabrics.

But this attempt to regulate the market did not work. Enforcement of the labour legislation led to evasion and protests. In the longer term, real wages rose as the population level stagnated with recurrent outbreaks of the plague.

Landlords struggled to come to terms with the changes in the land market as a result of the loss in population. There was large-scale migration after the Black Death as people took advantage of opportunities to move to better land or pursue trade in the towns. Most landlords were forced to offer more attractive deals to ensure tenants farmed their lands.

A new middle class of men (almost always men) emerged. These were people who were not born into the landed gentry but were able to make enough surplus wealth to purchase plots of land. Recent research has shown that property ownership opened up to market speculation.

The dramatic population change wrought by the Black Death also led to an explosion in social mobility. Government attempts to restrict these developments followed and generated tension and resentment.

Meanwhile, England was still at war with France and required large armies for its campaigns overseas. This had to be paid for, and in England led to more taxes on a diminished population. The parliament of a young Richard II came up with the innovative idea of punitive poll taxes in 1377, 1379 and 1380, leading directly to social unrest in the form of the Peasants’ Revolt of 1381.

Peasants revolting in 1381. Miniature by Jean de Wavrin

This revolt, the largest ever seen in England, came as a direct consequence of the recurring outbreaks of plague and government attempts to tighten control over the economy and pursue its international ambitions. The rebels claimed that they were too severely oppressed, that their lords “treated them as beasts”.
Lessons for today

While the plague that caused the Black Death was very different to the coronavirus that is spreading today, there are some important lessons here for future economic growth. First, governments must take great care to manage the economic fallout. Maintaining the status quo for vested interests can spark unrest and political volatility.

Second, restricting freedom of movement can cause a violent reaction. How far will our modern, mobile society consent to quarantine, even when it is for the greater good?

Plus, we should not underestimate the knee-jerk, psychological reaction. The Black Death saw an increase in xenophobic and antisemitic attacks. Fear and suspicion of non-natives changed trading patterns.

There will be winners and losers economically as the current public health emergency plays out. In the context of the Black Death, elites attempted to entrench their power, but population change in the long term forced some rebalancing to the benefit of labourers, both in terms of wages and mobility and in opening up the market for land (the major source of wealth at the time) to new investors. Population decline also encouraged immigration, albeit to take up low skilled or low-paid jobs. All are lessons that reinforce the need for measured, carefully researched responses from current governments.

Authors

Adrian R. Bell
Chair in the History of Finance and Research Dean, Prosperity and Resilience, Henley Business School, University of Reading

Andrew Prescott
Professor of Digital Humanities, University of Glasgow

Helen Lacey
Lecturer in Late Medieval History, University of Oxford

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The Black Death and COVID-19 

with Winston Black

This week, with headlines turning once again to stories of the plague, Danièle catches up with Winston Black to talk about The Black Death and COVID-19, what’s different about them, and what we can learn today from looking back on the biggest pandemic in human history.

Winston E. Black’s latest book is Medicine and Healing in the Premodern West: A History in Documents, published by Broadview Press. He also just published The Middle Ages: Facts and Fictions through ABC-CLIO. You can see more of his works through his Academia.edu page or follow him on Twitter @WinstonEBlack

This his second appearance on The Medieval Podcast – click here to listen to ‘Medieval Medicine with Winston E. Black’

See also:

The Coronavirus is not the Black Death

The Medieval Origins of Quarantine

Coping with Pandemics in the Middle Ages

The Economic Consequences of the Black Death
Paolo Malanima
Contact with other animals was the cause of the worst infectious illnesses
that have affected the human species in past agrarian societies. 
Various strains of influenza, smallpox, malaria, plague, measles, and cholera were provoked by infections which first affected domestic animals or those non-domestic species with
which humans came into contact, such as mice, fleas or lice and were then transmitted from animals to humans and from humans to other animals. In pre-modern agrarian societies, between two thirds and three quarters of deaths were caused by infectious diseases. 

Only in recent times has what is defined as an epidemic transition taken place. In 18th–19th century Europe there was a shift from illnesses transmittable from one person to another to degenerative non-infectious diseases. The mortality rate has depended to a lesser degree on bacteria and viruses and on the inter-specific struggle among different animal species.

Great epidemics mark the agricultural world of the past; from Neolithic times
onwards. The formation of much denser societies with respect to those of hunters
and gatherers, and daily contact with domestic animals are at the origins of serious
epidemic infections which have accompanied humans for 10,000 years. Among
these are infections of the digestive system – typhoid and paratyphoid fevers, dysentery, diarrhoea, cholera --; infections of the breathing apparatus, transmitted through the air -- smallpox, diphtheria, measles, influenza --: infections of the reproductive system -- syphilis and venereal diseases in general --; diseases introduced into tissue and into the blood stream deriving from insect bites -- plague, typhoid fever, yellow fever and malaria --.

Density and mobility of population, and poor diet have often been regarded as determinants of these epidemics. The relationship between population and resources plays an important role, but chance also plays a role in the spread of infections.

The existence of the plague in Europe from the 14th until the 18th century has
been discussed in recent years. Although some differences exist between the medieval disease and the one directly observed by modern epidemiologists, the prevailing opinion is still that the Black Death was actually caused by plague.

READ ON

Plague

Social and Economic Effects of the Plague

The plague had large scale social and economic effects, many of which are recorded in the introduction of the Decameron. People abandoned their friends and family, fled cities, and shut themselves off from the world. Funeral rites became perfunctory or stopped altogether, and work ceased being done. Some felt that the wrath of God was descending upon man, and so fought the plague with prayer. Some felt that they should obey the maxim, "Eat, drink, and be merry, for tomorrow you may die." The society experienced an upheaval to an extent usually only seen in controlled circumstances such as carnival. Faith in religion decreased after the plague, both because of the death of so many of the clergy and because of the failure of prayer to prevent sickness and death.

The economy underwent abrupt and extreme inflation. Since it was so difficult (and dangerous) to procure goods through trade and to produce them, the prices of both goods produced locally and those imported from afar skyrocketed. Because of illness and death workers became exceedingly scarce, so even peasants felt the effects of the new rise in wages. The demand for people to work the land was so high that it threatened the manorial holdings. Serfs were no longer tied to one master; if one left the land, another lord would instantly hire them. The lords had to make changes in order to make the situation more profitable for the peasants and so keep them on their land. In general, wages outpaced prices and the standard of living was subsequently raised.

As a consequence of the beginning of blurring financial distinctions, social distinctions sharpened. The fashions of the nobility became more extravagant in order to emphasize the social standing of the person wearing the clothing. The peasants became slightly more empowered, and revolted when the aristocracy attempted to resist the changes brought about by the plague. In 1358, the peasantry of northern France rioted, and in 1378 disenfranchised guild members revolted. The social and economic structure of Europe was drastically and irretrievably changed.

(Ed: D.S.) Courie, Leonard W. The Black Death and Peasant's Revolt. New York: Wayland Publishers, 1972; Strayer, Joseph R., ed. Dictionary of the Middle Ages. New York: Charles Scribner's Sons. Vol. 2. pp. 257-267.
Other Pages in Plague: Effects
Social and Economic Effects of the Plague |
The Death Toll

Bubonic Plague

The plague, named the Black Death by later historians, had a devastating effect on the European population in the fourteenth century.

Overview

The diffusion of crops and pathogens, including epidemic diseases like the bubonic plague, often occured along trade routes.

The bubonic plague - named the Black Death by later historians - was caused by the yersinia pestis bacteria, which lived in rodent populations and was spread by fleas that had bitten infected animals.

Once the plague transferred to animals that were in close contact with humans and to humans themselves, it began to spread along established trade routes.

It is difficult to measure the exact human cost of the plague due to limited records from the historical period.

Most historians think that the plague killed somewhere between 30% and 60% of Europe’s population between 1347 and 1351.

Trade and disease

The spread of disease and trade went hand in hand, and no event illustrates this relationship better than the outbreak of bubonic plague in the mid-14th century, an event more commonly known today as the Black Death.

In a passage from his book titled The Decameron, Florence, Italy resident Giovani Boccaccio described the Black Death, which reached Florence in 1348:

It first betrayed itself by the emergence of certain tumors in the groin or the armpits, some of which grew as large as a common apple, others as an egg, some more, some less . . .

From the two said parts of the body this deadly [bubo] soon began to propagate and spread itself in all directions indifferently; after which the form of the malady began to change, black spots or livid making their appearance in many cases on the arm or the thigh or elsewhere, now few and large, then minute and numerous.

Historians and epidemiologists are confident that the Black Death originated in east-central Asia, which raises the question: How did the plague make it to Europe?

To understand how the plague spread, we need to understand how the disease was transmitted, along with the broader economic and political contexts that made its spread possible.

The plague spreads
By the 1300s, several Italian city-states had established trade relationships throughout the Mediterranean and Black Seas. The Genoese had a successful colony at the city of Kaffa on the Crimean Peninsula, which they held with the permission of the Mongol rulers of the region. In 1344, disagreements between the Genoese and the Mongols led to conflict.

Note how much of Europe was linked via trade routes. Compare the map below showing the spread of plague to the routes shown here to see how the plague spread north from the Mediterranean ports. Image credit: Wikimedia commons.

In 1346, the plague reached the Mongol soldiers who were besieging the city of Kaffa. Stories from the period tell us that the plague devastated the Mongol army, forcing it to give up the siege. Some of these stories also include a more gruesome detail: the Mongols catapulted the dead bodies of the soldiers who died of the plague into the city.

Whether the Mongols intended to spread the disease, and whether the story is even true, is not clear. What is clear is that some residents of Kaffa were infected with plague.

The plague continued to travel through Asia, eventually hitting major cities such as Baghdad and Constantinople. From there, it traveled to Alexandria in Egypt, Damascus in Syria, and down the Red Sea to Mecca. From there it almost certainly entered the Indian Ocean trade networks. The plague also traveled with Genoese merchants back to Italy, first to the port of Messina in 1347, and then north through Europe over the next several years.

The first cases of plague in Europe were spread by Genoese traders returning from Kaffa. Note that the earliest areas of plague were around Constantinople and in the islands of Sicily, Sardinia, and Corsica, and also the port of Marseille. All of these would have been stops for Genoese ships on their way from Crimea to Genoa. (Genoa is on the coast roughly between Marseille and Milan.) Image credit: Wikimedia.

Taking both maps together, does the spread of the plague through Europe seem to have any relationship with important trade routes?

Cruel windfall: How wars, plagues, and urban disease propelled Europe’s rise to riches

Hans-Joachim Voth, Nico Voigtländer 29 July 2009

In modern economic thinking, peace and prosperity go hand in hand. However, there are good reasons why in pre-modern societies, the opposite relationship held true – war, disease, and urban death spelled high incomes. This column explains why Europe’s rise to riches in the early modern period owed much to exceptionally bellicose international politics, urban overcrowding, and frequent epidemics.

PANDEMICS, PLACES, AND POPULATIONS:EVIDENCE FROM THE BLACK DEATH Mark Koyama, Remi Jedwab and Noel Johnson

Discussion Paper DP13523 
 Published 12 February 2019
 Submitted 11 February 2019 

Centre for Economic Policy Research 
 33 Great Sutton Street, London EC1V 0DX, UK 
 www.cepr.org 

Abstract 
The Black Death killed 40% of Europe’s population between 1347-1352, making it one of the largest shocks in history. Despite its importance, little is known about its spatial effects and the effects of pandemics more generally. Using a novel dataset that provides information on spatial variation in Plague mortality at the city level, as well as various identification strategies, we explore the short-run and long-run impacts of the Black Death on city growth. On average, cities recovered their pre-Plague populations within two centuries. In addition, aggregate convergence masked heterogeneity in urban recovery. We show that both of these facts are consistent with a Malthusian model in which population returns to high-mortality locations endowed with more rural and urban fixed factors of production. Land suitability and natural and historical trade networks played a vital role in urban recovery. Our study highlights the role played by pandemics in determining both the sizes and placements of populations.

Pandemics, places, and populations: Evidence from the Black Death

Rémi Jedwab, Noel Johnson, Mark Koyama 08 May 2019

The Black Death killed 40% of Europe’s population between 1347 and 1352, but little is known about its spatial effects. The column uses variation in Plague mortality at the city level to explore the short-run and long-run impacts on city growth. After less than 200 years the impact of Black Death mortality in cities was close to zero, but the rate of urban recovery depended on advantages that favoured trade.

The American Road to Capitalism
Studies in Class-Structure, Economic Development
and Political Conflict, 1620–1877
By
Charles Post
With a Foreword
by
Ellen Meiksins Wood
Historical Materialism 28
Brill 2011

Charles Post
The American Road to Capitalism
https://faculty.bmcc.cuny.edu:7002/faculty/upload/American%20Road%20to%20Capitalism,%201982.pdf
Essay 1982
This essay is an attempt to examine the theoretical and historiographic debates
on the development of capitalism in the United States between 1790 and 1877.
The realization of the necessary conditions for capitalist production in the
United States took place through the articulation, expanded reproduction and
transformation of three forms of production, and through a process of political
class struggle that culminated in the Civil War. Each of these forms of
production—slavery, petty-commodity production and capitalist manufacture
—has been the subject of theoretical and historiographic controversy. These
debates will be reviewed in order to determine the place of each productive
form in the development of us capitalism. The Civil War’s place in the history
of us capitalist development has also been the subject of well-known
controversy; these discussions will be scrutinized to determine how the class
struggle that culminated in the War affected capitalist development in the

United States.

The spirit of capitalism and long-run growth (English)

Heng-fu Zou

(Public Economics Division, Policy Research Department, The World Bank)

ABSTRACT

Why do different countries have different long-term savings and growth rates? Why is the productivity rate not the same around the world? Recent new theories of endogenous growth have tried to answer these questions by replacing the usual assumption of diminishing returns in production. The author offers an alternative: he introduces "the spirit of capitalism" into the model. In the long run, countries with different degrees of capitalist spirit will have different consumption, capital stock, and endogenous growth rates. In his model, inflation is no longer superneutral in relation to long-run growth. The author provides a formal model that is supported by many empirical and historical studies on cultural attributes and economic development. His model helps explain: (a) why Japan and four East Asian countries, South Korea, Taiwan, Hong Kong and Singapore have succeeded; (b) why nations that had an established Protestant religion in 1870 had a per capita income in 1979 that was more than a third higher than in Catholic nations; and (c) why British industry has declined since 1850.

An Introduction to the History of Capitalism 600-1900 AD
by Benedikt Koehler, David Abulafia, Victoria Bateman, Huw Bowen, Nicholas Crafts
with an introduction by Hywel Williams

THE CULTURE OF PROSPERITY | APRIL 2015

ABOUT THE LEGATUM INSTITUTE
The Legatum Institute is an international think-tank and educational
charity focussed on promoting prosperity. We do this by researching
our core themes of revitalising capitalism and democracy. The Legatum
Prosperity IndexTM, our signature publication, ranks 142 countries in terms
of wealth and wellbeing.

Through research programmes including The Culture of Prosperity,
Transitions Forum, and the Economics of Prosperity, the Institute seeks
to understand what drives and restrains national success and individual
flourishing. The Institute co-publishes with Foreign Policy magazine,
the Democracy Lab, whose on-the-ground journalists report on political
transitions around the world.

The Legatum Institute is based in London and an independent member of
the Legatum Group, a private investment group with a 27 year heritage
of global investment in businesses and programmes that promote
sustainable human development.

Culture of Prosperity
The values that motivate individuals, societies and nations are reflected and
encapsulated in the cultural achievements that endure. These are the means
by which successive generations have achieved greater self-knowledge and
the study of their significance, both in the past and the present, animates
‘The Culture of Prosperity’.

History of Capitalism
In the wake of the banking collapse of 2008 capitalism has had to
surmount a profound economic crisis while also confronting severe attacks
on its code of ethics. This three-year course will investigate the origins
and development of a movement of thought and endeavour which has
transformed the human condition.
CONTENTS
Introduction 2
by Hywel Williams

Early Islam and the Birth of Capitalism 4
by Benedikt Koehler

A Global Transition: From the Mediterranean to the Atlantic 12
by David Abulafia

A The Changing Axis of Economic Power in the Early Modern Period 22
by Victoria Bateman

Making Money, Making Empires: The Case of the East India Company 32
by Huw Bowen

Industrialisation: Why Britain Got There First 38
by Nicholas Crafts


About the Authors