Monday, March 30, 2020
The costs of slowing the spread of coronavirus are enormous. ... But what are the benefits from this pain of social distancing? It turns out you can put a dollar figure on reducing deaths from COVID-19. And it is an enormous figure: $8 trillion, according to modeling by economists at the University of Chicago, whose economics department is best known for its defense of the harsh orthodoxies of free markets. "These benefits are over one-third of U.S. GDP and larger than the entire annual federal budget," the economists write.
The University of Chicago model focuses on the financial value of the lives that can be saved. To calculate this figure, the economists lean on a federal figure called the "value of a statistical life" that government agencies routinely use in weighing the costs and benefits of policy changes like raising the speed limit on the highways or imposing new restrictions for environmental pollutants.
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