How Pandemics Affect the Economy

Read through this article.

The article explores the economy of Europe after the Black Death. From 1348-1350, Europe lost 60% of its population. This article is not concerned with the economy during the actual pandemic but in the years afterward. A few key things happened:

  • In the years leading up to the Black Death, Europe was very densely populated and resources, like fertile land, were becoming incredibly scarce. With the massive population decrease, resources suddenly became more available and cheaper. This increased supply and decreased prices.
  • Additional resources meant that every worker was far more productive. This increased supply and decreased prices.
  • This increase in supply meant that entrepreneurs saw better returns on their investments and had more money to invest. This also increased supply and decreased prices. Remember that in those days, entrepreneurs generally started much smaller companies, often limited to themselves or their families. A window making shop, or a shoemaker, for instance.
  • The giant decrease in the labor force saw a drastic increase in wages. This increased demand and increased prices.

The overall combination of all of these factors is that people were able to produce more, got paid better to produce more, and were able to buy far more with their money. This created a long term economic boom that helped Europe dominate the world economy for centuries.

Now try watching this video

So what will come in the generation after the coronavirus? The factors the article and the video put forward:

  • We already have an issue with “low skill” jobs being taken by robots. This is called automation. We’re currently trying to find more ways to remove people from the workforce to keep them safe. Will these changes become permanent? Are we looking at more people being pushed out of the workforce?
  • As more people work and consume from home, it becomes clear that we don’t need to invest as much in moving and commuting. Will this make jobs, education, and other things more accessible? Will fewer people move to the same elite coastal cities?
  • Nearly every country, including the United States, is making transfer payments to their people without qualification. They’re literally giving people money. This has been called many things like Universal Basic Income. It was considered one of the very extreme ideas proposed in this year’s presidential primaries. Will this experience make it seem more normal?
  • The workers who are currently deemed essential and are on the front lines of fighting this disease are also workers who are consistently underpaid. This includes near minimum wage workers like delivery drivers, grocery store workers, and fast food workers, and also nurses. Will the newfound respect for these workers help push minimum wage higher?
  • The elderly are far more vulnerable. The current elderly generation, The Baby Boomers, were a very large generation. They have dominated our country’s culture and politics for about 50 years. For instance, every President since 1993 has been a Boomer. If they die in large numbers, how will this change the economy?

How do you think the coronavirus will affect our economy in the long run? If you have guesses, post them at Google Classroom ( or here in the comments. You can also ask follow up questions. I will try to respond to all of them.

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Welcome to Government Spending!

Celebrating Spirit Week, here is my cat Sebastian bothering me during a conference call. #PioneerPride

Now that we’ve learned market failures, it’s time to move into government spending. The government spends money for two reasons: to fix market failures and to achieve economic goals (remember those from Chapter 2?).

As we’ve been doing for the last few chapters, having you read about the concepts before we dive into teaching it helps you to understand what we’re talking about. You can see this assignment on Google Classroom ( or you can just make a copy off Google Docs ( This is a little shorter than other chapters and will be due Friday, April 3 at 11:59pm. The instructions are below.

Read Chapter 10 of the textbook (pages 260-287 in the paper copy; pages 281- 308 in the digital copy). Use the information to answer the questions in the attached doc.

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The Jobs Report and Essential Workers

The U.S. Department of Labor released its weekly jobs report yesterday. It was bad. Historically bad. And worse than predicted. 3.3 million claims for unemployment, which is about 4.5 times the previous record. Read about it here:

All of this is happening because state governments are ordering all non-essential workers to stay home. Most do not get paid. This raises the question of what are essential workers?

In a crisis like this, medical professionals are the easy choice as essential, but some other professions may be surprising. Workers at grocery stores, fast food restaurants, and childcare facilities are deemed essential. These are near minimum wage jobs. These are exactly the professions that have been involved in Fight for Fifteen, the push for a higher minimum wage.

Many supporters of Fight for Fifteen are using this designation as essential as proof that these workers should be paid more. However, this also could be seen as another example of the Paradox of Value. Needs are always cheaper than wants. These are the difficult questions about economics we want you to consider.

Otherwise today, there are three assignments you could be working on:

You have the luxury of managing your own time. Do it well.

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The Stimulus Package

CNN has an excellent description of the $2.2 trillion stimulus package at

As we are discussing macroeconomics, this is very interesting. The government is trying to keep demand from dropping. As more people are out of work, their income drops, which you remember, means a drop in demand. The government is proposing several different ways to keep money in people’s pockets, which should keep demand from falling too much. When we start talking about government spending next week, we will talk about demand-side economics. This is just a good discussion to have. Please hit me with any questions.

Otherwise today, there are three assignments you could be working on. The Market Failures Slideshow is due this evening at 11:59pm ( The Monopoly Questions are open for a retake ( The Chapter 7 objectives are due on Sunday ( You have the luxury of managing your own time. Do it well.

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Retake Monopolies Questions

Scores on the Monopolies Questions were okay, but I’d prefer awesome. I have created a review video. You must watch the video below, then retake the quiz at this link for full credit.

Don’t forget, you have two other assignments you’re working on, the slideshow is due tomorrow night at 11:59pm (Link on Google Classroom) and the learning objectives are due Sunday night at 11:59pm (Link on Google Classroom).

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Homework: Market Failures Learning Objectives

This is a market failure! But which one?

For Sunday at 11:59pm, complete the learning objectives for Chapter 7 on Market Failures. Get the details on Google Classroom:

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Market Failures Slideshow, Monopoly Questions, Plus Extra Video

Mr Radcliffe and I had a discussion. We have decided to extend the deadline for the slideshows ( until Thursday 11:59pm. The deadline for the monopoly questions ( is still tonight at 11:59pm.

While you have extra time, keep in mind there will still be new assignments this week, including a new one tomorrow. Keep up. We are entering a recession and knowing your economics is more important now than ever. Politicians are starting to talk about choosing between the economy and saving lives. Be aware.

Today, focus on the previous assignments. If you need more info about market failures, check out the video linked below.

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Video: Monopolies

Watch this video!


Watch the video above or go to, then answer the questions about monopolies below.

Questions to answer:

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Homework: Market Failures Slideshow

Due Monday, March 23rd by 11:59pm

You will create a slideshow using Google Slides to define all of the market failures we have learned about. Go into Google Slides to find the template. Change the title of your slideshow to have your name in it.

First, you must name all FIVE failures. Then you must define them. Last, give examples of these failures as they currently exist in the world. You can find this info in Chapter 7 of the textbook (

You will also be judged on the style of your presentation.

The finished product should be submitted through Google Classroom by no later than 11:59pm on Monday, March 23rd. Submissions sent in past the deadline will have points deducted.

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Intro to Market Failures

Head to Google Classroom to see the latest assignment. Read through the slideshow on market failures and answer the discussion question.

Don’t forget, there will be something to look at every school day!

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