Open Access Journal Article

In search of an optimal public policy in a pandemic: The question of lives versus livelihood

by Gopal K. Basak a ,  Chandramauli Chakraborty b  and  Pranab Kumar Das c,* orcid
a
Theoretical Statistics and Mathematics Unit, Indian Statistical Institute, Kolkata, India
b
Indian Statistical Institute, Kolkata, India
c
Centre for Studies in Social Sciences Calcutta, Kolkata, India
*
Author to whom correspondence should be addressed.
JEA  2024 3(4):76; https://doi.org/10.58567/jea03040002
Received: 17 July 2023 / Accepted: 9 September 2023 / Published Online: 15 December 2024
View Full-Text
Download PDF

Abstract

The paper addresses the alternative policy options available to address the question of lives versus livelihood in an SIRD model augmented with a macroeconomic structure. An important contribution of the paper lies in designing the policy of lockdown dependent on the extent of the constraint on the health facilities. The paper supplements the literature with a less stringent version of the lockdown policy, viz. soft lockdown policy which is shown to be more attractive from a public policy standpoint and has actually been practised in many countries across the globe during the recent pandemic. Finally, the optimal policy derived on the basis of the level of lockdown and adjustment of the binding constraint on health facilities depends on the objective of policy makers contingent on the relative weights of lives versus livelihood.

Keywords: COVID-19; Corona virus; Macro-SIRD Model; Hard Lockdown; Soft Lockdown;
Copyright: © 2024 by Basak, Chakraborty and Das. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) (Creative Commons Attribution 4.0 International License). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

Share and Cite

ACS Style
Basak, G. K.; Chakraborty, C.; Das, P. K. In search of an optimal public policy in a pandemic: The question of lives versus livelihood. Journal of Economic Analysis, 2024, 3, 76. https://doi.org/10.58567/jea03040002
AMA Style
Basak G K, Chakraborty C, Das P K. In search of an optimal public policy in a pandemic: The question of lives versus livelihood. Journal of Economic Analysis; 2024, 3(4):76. https://doi.org/10.58567/jea03040002
Chicago/Turabian Style
Basak, Gopal K.; Chakraborty, Chandramauli; Das, Pranab K. 2024. "In search of an optimal public policy in a pandemic: The question of lives versus livelihood" Journal of Economic Analysis 3, no.4:76. https://doi.org/10.58567/jea03040002
APA style
Basak, G. K., Chakraborty, C., & Das, P. K. (2024). In search of an optimal public policy in a pandemic: The question of lives versus livelihood. Journal of Economic Analysis, 3(4), 76. https://doi.org/10.58567/jea03040002

Article Metrics

Article Access Statistics

References

  1. Acemoglu, D., Chernozhukov, V., Werning, I. & Whinston, M. D. (2021). A Multi-Risk SIR Model with Optimally Targeted Lockdown. American Economic Review: Insights, forthcoming. https://doi.org/10.1257/aeri.20200590
  2. Agarwal, M., Kanitkar, M., Phillip, D., Hajra, T., Singh, A., Singh, A., Singh, P.P. & Vidyasagar M. (2022). SUTRA: An Approach to Modelling Pandemics with Undetected Patients, and Applications to COVID-19. arXiv.org/abs/2101.09158v6. doi.org/10.48550/arXiv.2101.09158.
  3. Al-Qahtani, M., AlAli, S., Rahman, A. K. A., Alsayyad, A. S., Otoom, S. & Atkin, S. L. (2021). The prevalence of asymptomatic and symptomatic COVID19 disease in a cohort of quarantined subjects. Journal of Infectious Diseases,102, 285-288. https://doi.org/10.1016/j.ijid.2020.10.091.
  4. Alvarez, F. E., Argente, D. & Lippi F. (2021). A Simple Planning Problem for Covid-19 Lockdown. American Economic Review: Insights 3, 367-82. https:// doi.org/10.1257/aeri.20200201
  5. Anastassopoulou, C., Russo, L., Tsars, A. & Siettos C. (2020). Data-based analysis, modelling and forecasting of the COVID-19 outbreak. PLoS ONE 15(3), e0230405. https://doi.org/10.1371/journal.pone.0230405.
  6. Aspri, A., Beretta, E., Gandolfi, A. & Wasmer, E. (2021). Mortality containment vs. Economics Opening: Optimal policies in a SEIARD model. Journal of Mathematical Economics 93: 102490. https://doi.org/10.1016/j.jmateco.2021.102490.
  7. Barro, R. J., Urs’ua, J. F. & Weng, J. (2020). The coronavirus and the great influenza pandemic: Lessons from the “Spanish flu” for the coronavirus’s potential effects on mortality and economic activity. (NBER Working Paper No. 26866). https://doi.org/10.3386/w26866.
  8. Basak, G. K., Chakraborty, C., Das, P. K. (2021): Optimal Lockdown Strategy in a Pandemic: An Exploratory Analysis for Covid-19. (arXiv.org pre-print). https://arxiv.org/abs/2109.02512.
  9. Berger, D. W., Herkenhoff, K. F. & Mongey S. (2020). An seir infectious disease model with testing and conditional quarantine. (NBER Working Paper No. 26901). https://doi.org/10.3386/w26901.
  10. Bertozzi, A. L., Franco, E., Mohler, G., Short, M. B. & Sledge, D. (2020). The challenges of modeling and forecasting the spread of COVID-19. (arXiv.org). https://arxiv.org/abs/2004.04741.
  11. Bethune, Z. A. & Korinek, A. (2020). Covid-19 infection externalities: Trading off lives vs. livelihood. (NBER Working Paper No. 27009). https://doi.org/10.3386/w27009.
  12. Bhattacharjee, S., Liao, S., Paul, D., & Chaudhuri, S. (2022): Inference on the dynamics of COVID-19 in the United States, Sci Rep 12, 2253. https://doi.org/10.1038/s41598-021-04494-z.
  13. Border, A., Gray, D., Islam, A. & Bhuiyan, S. (2021). A literature review of the economics of COVID-19. Journal of Economic Surveys 35, 1007-1044. https://doi.org/10.1111/joes.12423.
  14. Born, B., Dietrich, A. & Mu¨ller, G. J. (2021). Do Lockdowns Work? A Counterfactual for Sweden. PLoS ONE 16(4): e0249732. https://doi.org/10.1371/journal.pone.0249732.
  15. Bryant, P. & Elofsson, A. (2020). Estimating the impact of mobility patterns on COVID-19 infection rates in 11 European countries. (medRxiv.org). https://doi.org/10.1101/2020.04.13.20063644.
  16. Buonsenso, D., De Rose, C., Pierantoni, L. (2021). Doctors’ shortage in adults COVID-19 units: a call for pediatricians, European Journal of Pediatrics 180, 2315–2318. https://doi.org/10.1007/s00431-021-03995-3.
  17. Casseli, F., Grigori, F., Lian, W. & Sandri, D. (2021). Protecting Lives and Livelihoods with Early and Tight Lockdowns. THE BE Journal of Macroeconomics, 2, 241-268. https://doi.org/10.1515 bejm-2020-0266.
  18. Caulkins, J., Grass, D., Feichtingelear, G., Hartl, R., Kort, P. M., Prskawetz, A., Seidi, A. & Warzaczek, S. (2020). How long should the COVID-19 lockdown continue? PLoS ONE 15 12: e0243413. https://doi.org/10.1371/journal.pone.0243413.
  19. Caulkins, J. P., Grass, D., Feichtinger G, Hartl RF, Kort PM, Prskawetz A, Seidl A, Wrzaczek S. (2021). The optimal lockdown intensity for covid-19. Journal of Mathematical Economics 93: 102489. https://doi.org/10.1016/j.jmateco.2021.102489.
  20. Chowell, G., Hyman, J. M., Bettencourt, L. M. & Castillo-Chavez, C. (2009). Mathematical and statistical estimation approaches in epidemiology. Springer. https://doi.org/10.1007/978-90-481-2313-1.
  21. Dimdore-Miles, O. & Miles, D. (2020). Assessing the spread of the novel coronavirus in the absence of mass testing. International Journal of Clinical Practice. https://doi.org/10.1111/ijcp.
  22. Eichenbaum, M. S., Rebelo, S. & Trabandt, M. (2020). The Macroeconomics of Epidemics. (NBER Working Paper No. 26882). https://doi.org/10.3386/w26882.
  23. Farboodi, M., Jarosch, G. & Shimer, R. (2020). Internal and External Effects of Social Distancing in a Pandemic. (NBER Working Paper No. 27059). https://doi.org/10.3386/w27059.
  24. Fosco, C. & Zurita, F. (2021). Assessing the short-run effects of lockdown policies on eco- nomic activity, with an application to the Santiago Metropolitan Region, Chile. PLoS ONE 16, 6: e0252938. https://doi.org/10.1371/journal.pone.0252938.
  25. Gatto, M., Bertuzzo, E., Mari, L., Miccoli, S., Carraro, L., Casagrandi, R. & Rinaldo A. (2020). Spread and dynamics of the COVID-19 epidemic in Italy: Effects of emergency containment measures. Procedings of National Academy of Sciences 117, 19: 10484–10491. https://doi.org/10.1073/pnas.2004978117.
  26. Gollier, C. (2020). Cost-benefit analysis of age-specific deconfinement strategies. Journal of Public Economic Theory 22, 1746-7. https://doi.org/10.1111/jpet.12486
  27. Gori, L., Manfredi, P., Marsiglio, S. & Sodini, M. (2021). COVID-19 epidemic and mitigation policies: Positive and normative analyses in a neoclassical growth model. Journal of Public Economic Theory, 1–25. https://doi.org/10.1111/jpet.12549.
  28. Government of India. (2020): Provisional Estimates of Annual National Income 2019-2020 and Quarterly Estimates of Gross Domestic Product for the Fourth Quarter (Q4) of 2019-20. National Statistical Office, Ministry of Statistics and Programme Implementation.
  29. Gregory, V., Menzio, G. & Wiczer, D. (2020). Pandemic Recession: L or V-Shaped? Quarterly Review, Federal Reserve Bank of Minneapolis 40, 1, 1-40. https://doi.org/10.21034/qr.4011
  30. Grigorieva, E., Khailov, E. & Korobeinikov, A. (2020). Optimal quarantine strategies for COVID-19 control models. (arXiv.org). https://arxiv.org/abs/2004.10614.
  31. Guerrieri, V., Lorenzoni, G., Straub, L. & Werning I. (2021). Macroeconomic Implications of COVID 19: Can Negative Supply Shocks Cause Demand Shortages? American Economic Review. https://www.aeaweb.org/articles?id=10.1257/aer.20201063.
  32. Hall, R. E., Jones, C. I. & Klenow, P. J. (2020). Trading Off Consumption and Covid-19 Deaths. (Stanford University Working Paper No. 20-026). http://siepr.stanford.edu/sites/default/files/publications/20-026.pdf.
  33. Hethcote, H. W. (2000). The Mathematics of Infectious Diseases. SIAM Review,42,4,599-653. http://www.siam.org/journals/sirev/42-4/37190.htnil.
  34. ILO. (2018). India Wage report: Wage policies for decent work and inclusive growth. ILO, Geneva.
  35. Ji, Y., Ma, Z., Peppelenbosch, M. P., & Pan, Q. (2020). Potential association between COVID-19 mortality and health-care resource availability, The Lancet 8, 4. https://doi.org/10.1016/S2214-109X(20)30068-1.
  36. Jones, C. J., Philippon, T. & Venkateswaran, V. (2020). Optimal Mitigation Policies in a Pandemic: Social Distancing and Working from Home. (NBER Working Paper No. 26984). https://doi:10.3386/w26984.
  37. Kaplan, G., Moll, B. & Violante, G. (2020). The Great Lockdown and the Big Stimulus: Tracing the Pandemic Possibility Frontier of the US. (BFI Working Paper No. 2020-119). http://bfi.uchicago.edu/working-paper/2020-119.
  38. Kermack, W. O., McKendrick & A. G. (1927). A contribution to the mathematical theory of epidemics. Proceedings of the Royal Society of London. Series A, Containing Papers of a Mathematical and Physical Character, 115, 772, 700–721. https://www.jstor.org/stable/94815
  39. Majumder, A. & Madheswaran, S. (2018). Value of Statistical Life in India: A Hedonic Wage Approach. (ISEC Working Paper No. 407). http://www.isec.ac.in/-Agamoni Majumder and Madheswaran-Final.pdf.
  40. Moolla, I., Hiilamo, H. (2023). Health system characteristics and COVID-19 performance in high-income countries. BMC Health Services Research, 23, 244. https://doi.org/10.1186/s12913-023-09206-z.
  41. Rampini, A. (2020). Sequential Lifting of COVID-19 Interventions with Population Heterogeneity. (NBER Working Paper No. 27063). https://doi:10.3386/w27063.
  42. Robeznieks, A. (2022). What we’ve learned about COVID-19, burnout and the doctor shortage, Association of American Medical Colleges. https://www.ama- assn.org/print/pdf/node/85241.
  43. Sameni, R. (2020). Mathematical Modeling of Epidemic Diseases; A Case Study of the COVID-19 Coronavirus. (arXiv.org Pre-print). https://arxiv.org/abs/2003.11371.
  44. Schelling, T. C. (1968). The Life You Save May Be Your Own. In S. B. Chase Jr. (Ed.). Problems in Public Expenditure Analysis (pp. 127-62). Washington D.C.: Brookings Institution. http://hdl.handle.net/10822/762904.
  45. Sharma, D., Bouchaud, J.-P., Gualdi, S., Tarzia, M. & Zamponi, F. (2021). V–, U–, L– or W–shaped economic recovery after Covid-19: Insights from an Agent Based Model. PLoS ONE 16, 3: e0247823. https://doi.org/10.1371/journal.pone.0247823.
  46. The Print. (2021). 1 doctor for 1,511 people, 1 nurse for 670—Covid exposes India’s health- care ‘fault lines’, Feb. 11, https://theprint.in/health/1-doctor-for-1511-people-1-nurse-for-670-covid-exposes-indias-healthcare-fault-lines/602784.
  47. Viscusi, W. K. & Aldy, J. E. (2003). The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World. The Journal of Risk and Uncertainty 27, 1, 5-76. https://www.jstor.org/stable/41761102.