Economic Effects of Pandemic Influenza

The purpose of this work is to estimate the effects of a pandemic influenza epidemic on the U.S. economy. Previous models, such at the Congressional Budget Office report, assume that revenue will be lost in various sectors due to people deciding to curtail activities such as theaters, restaurants, and travel. Compared to the 1918-19 economy, the US economy has become “just in time” with modest inventories; it is completely dependent on gasoline and diesel fuel for travel, and has many high skilled jobs that can be performed only by a small group of workers, e.g., nuclear power plant operators. This means that the 2007 economy is more “brittle”, less resilient, than the economy of a century ago. Quantifying this brittleness requires identifying the significant losses associated with the interruption of supply chains that would result from large scale worker absenteeism.