How the plague initiated a phase of prosperity

Bloomberg

A recent study by Matthijs Korevaar, Assistant Professor of Finance at Erasmus School of Economics, found that Amsterdam recovered surprisingly quickly from the bubonic plague in 1665. According to an article in Bloomberg, the study, which also examined the economic effects of cholera in Paris in the 19th century, complicates the vision of how cities have been affected historically by epidemics.

A prosperous outcome

The study finds, by looking at the 17th century housing market, prices did indeed decrease sharply as the economy floundered. As death rates fell, however, things stabilized with surprising speed, followed by a period of urban innovation that ultimately had positive effects. The study suggests that cities can actually prosper after a health crisis because the shock can initiate changes that create better living conditions.

Active stimulation

In Amsterdam, the economy swiftly recovered its pre-epidemic population by attracting migrants. According to the researchers, the lessons may therefore best be applied to developing cities and countries with stark societal inequalities and limited government support, rather than the contemporary Netherlands. In Paris, the same observation was made: the magnetic draw of the city led to migrants that were willing to accept the health risks to achieve greater financial well-being. 

During the worst months of the plague, construction work, along with much other economic activity, came to a halt. However, it soon resumed after. Amsterdam actively stimulated its revival, using a tool that at the time was innovative. City records suggest that, for the first time, Amsterdam allowed landlords to buy its land parcels not using state loans.

A familiar sight

Most likely, the plague came to Amsterdam by boat but Amsterdammers believed that the disease was spread through corrupted air, rising from rotting matter or from inherently unhealthy spots. Previous plague epidemics had also taught people that keeping distance from others could help and the attempts at isolation may indeed have saved lives. Researchers in Paris looked at death rates shortly after the cholera plague, observing that some parts of the city were especially harmed by the disease. This led to a major rework of the city, with wide and regular avenues to increase spacing between buildings and people. What is striking about Amsterdam’s measures is how familiar they are in the wake of Covid-19. The forms of containment we use today are the same ones we used in the 1600s.

More information

The full article from Bloomberg on Amsterdam, 14 April 2021, can be found here.  The full article from Bloomberg on Paris, 27 April 2021, can be found here