Economics vs. Epidemiology: Quantifying the Trade-Off

https://www.wsj.com/articles/economics-vs-epidemiology-quantifying-the-trade-off-11586982855

Wall Street Journal with the cold-hearted numbers. Conclusion: the lives saved are worth the economic pain, although, as always: can we do it cheaper?

«Federal regulators put the statistical value of a life at around $10 million.

….

In a March paper, Michael Greenstone and Vishan Nigam of the University of Chicago assign a lower value to older people and a higher one for the young. On that basis, they conclude that three months of social distancing could save 1.7 million lives worth $8 trillion.

So much for the benefit. What about the cost? Economists surveyed by The Wall Street Journal forecast annual GDP growth of 0.9% through 2022. That is down from a forecast of 1.9% in January, before social-distancing measures were adopted. I estimate that amounts to a loss of $3 trillion in today’s dollars. So in this accounting sense, the trade-off is worth it.»

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.