Time to Move on the Economy vs. Public Health Debate

Ryan BourneHuman life is highly valuable. Basic economic reasoning therefore suggests that, given the risks of COVID-19 to vulnerable populations, we should be willing to withstand large economic costs to prevent the risk of substantial numbers of deaths. This is particularly true if most of those economic costs are temporary.In response to Donald Trump ’stweet last week suggesting “WE CANNOT LET THE CURE BE WORSE THAN THE PROBLEM ITSELF,”many economists have indeed been makingthese points.They highlight estimates suggesting that the estimated value of a statistical life (commonly around $9.3 million) and a quality ‐​adjusted‐​life year ($129,000) tend to be high. They show that modeling from the CDC and Imperial College suggests a high loss of U.S. life if no action is taken to stop the spread of COVID-19. They work out the value of additional lost lives if no government action is taken to avoid the worst ‐​case scenarios where hospitals are over‐​capacity, with shortages of ICU beds. They conclude that we should be willing to incur trillions, and potentially tens of trillions, of lost economic output to ensure these lives are saved.Such simple analysis, though, largely tells us one thing: that inaction could be highly costly. Yet nobody is credibly suggesting today that we “do nothing.” What usually makes economists worth their salt is their ability to think on the margin, and to judge alternative realistic scenarios. Economists need...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs