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The 1918 Flu and COVID-19 Pandemics: Different Patients, Different Economy
Many observers seeking historical precedent for COVID-19 draw on the 1918 influenza pandemic. In this Commentary, we highlight the differences between the 1918 flu and COVID-19 pandemics in terms of the most significantly affected populations. We also show key differences in the US economy in the late 1910s and now. Not only did the 1918 influenza virus primarily affect significantly younger cohorts, but the US economy’s industry and geographic distributions were notably different at the time compared to today’s. Consequently, caution is needed when using the 1918 influenza pandemic as a ...
Why Are Headline PCE and Median PCE Inflations So Far Apart?
Mean (or headline) PCE inflation has typically fallen below median PCE inflation, and since 2012 the difference has been large. To understand the reasons for this trend, we investigate which components of the headline measure are contributing to the difference. We find that energy components, which frequently undergo wide price swings, and electronics, which have been steadily decreasing in price for decades, explain most of the difference between the two inflation measures. We argue that the outsized impacts of such components on headline PCE inflation reinforce the need for policymakers to ...