Coronavirus: The IMF policy tracker, country responses to the coronavirus economic crisis, and how do we value a statistical life? – what I have been reading today

Since I started to carefully study the coronavirus and its associated health and economic consequences in January 2020, I have been reading many news, research articles, and blog posts. I got more and more concerned and I hope that the situation will improve as soon as possible. Let me regularly share with you some interesting background articles:

This policy tracker of the International Monetary Fund (IMF) provides a useful summary of the most important economic responses that different countries have taken to limit the human and economic impact of the COVID-19 pandemic. The tracker includes 193 economies.

Ricardo Reis, a professor of economics at the London School of Economics, on how countries differ in their response to the coronavirus economic crisis. He argues convincingly that there is no right or wrong way for governments to deal with the financial impact of coronavirus – only trade-offs.

In 2016, Fan, Jamison, and Summers wrote an interesting paper on the cost of pandemic influenza risk. They wrote: “In any given year a small likelihood exists that the world will again suffer a very severe flu pandemic akin to the one of 1918. Even a moderately severe pandemic, of which at least 6 have occurred since 1700, could lead to 2 million or more excess deaths. World Bank and other work has assessed the probable income loss from a severe pandemic at 4-5% of global GNI. The economics literature points to a very high intrinsic value of mortality risk, a value that GNI fails to capture. In this paper we use findings from that literature to generate an estimate of pandemic cost that is inclusive of both income loss and the cost of elevated mortality. We present results on an expected annual basis using reasonable (although highly uncertain) estimates of the annual probabilities of pandemics in two bands of severity.”

Tim Harford gives a good overview on the value of a statistical life. He argues that “It is clear that we should be willing to pay huge costs to save lives from Covid-19”.

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