No abstract

The impact of COVID-19 on recent tendencies towards international isolationism has been much speculated on but remains to be seen. We suggest that valuable evidence can be gleaned from the “Spanish” flu of 1918–20. It is well-known that the world fell into a protectionist spiral following the First World War, but scholars have almost exclusively ignored the impact of the pandemic. We employ a difference-in-differences strategy and find that the flu had a significant impact on trade policy, independent of the war. In our preferred specification, a one standard deviation increase in excess deaths during the outbreak implied 0.022 percentage points higher tariffs subsequently, corresponding to an increase of one third of a standard deviation in tariffs. Health policy should aim to avoid the experience of the interwar period and consider the international macroeconomic impact of measures (not) taken.

The Malthusian model, which implies a long-run interaction between demography and living standards, forms a cornerstone of our understanding of comparative economic development, as postulated by Unified Growth Theory. Its empirical validity has been supported by a number of studies, most of which examine England. In Northern Italy, however, there might have been a reversed "preventive check". We employ a cointegrated VAR model on Italian data from ca. 1650-1799 and find some evidence for this, but also for diminishing returns and thus a more "Malthusian" society than in, for example, England at that time.

Purpose This work argues for and provides an empirical investigation of the idea that imperfectly informed consumers use simple signals to identify the characteristics of wine, for example, the geographical denomination. The reputation of a denomination will thus be an important guide for consumers when assessing individual wines. Design/methodology/approach The price–quality relationship is studied in a fairly homogenous geographical area where a large number of wine types is present. This is done by using a simple OLS analysis on a database of more than 2,000 different red wines produced in a period of just four years in only one Italian region. Findings The results show that some denominations have a lower average quality score and that price differentials between denominations are linked to differences in average quality, although consumers tend to exaggerate the quality gap between prestigious denominations and others. Research limitations/implications A producer in a prestigious denomination benefits from a substantial mark-up relative to an equally good producer from another denomination. Furthermore, denomination neutral wines have a stronger price–quality relationship than denomination specific wines. Practical implications Consumers should not be misled by what is on the bottle, but should rather consult wine guides to become better informed before purchasing. Social implications The fact that quality and sensory characteristics often play a minor role in determining the price of a commodity is not immediately compatible with the postulate that consumers are well informed. Originality/value Unlike previous work, this paper investigates a limited area (Tuscany) and only red wines, thus making it possible implicitly to control for many other factors which might otherwise confound the price–quality relationship.