Health vs. Wealth? Public Health Policies and the Economy During Covid-19

66 Pages Posted: 5 May 2020

See all articles by Zhixian Lin

Zhixian Lin

University of California, Davis

Christopher M. Meissner

University of California, Davis

Date Written: May 2020

Abstract

We study the impact of non-pharmaceutical policy interventions (NPIs) like “stay-at-home” orders on the spread of infectious disease. Local policies have little impact on the economy nor on local public health. Stay-at-home is only weakly associated with slower growth of Covid-19 cases. Reductions in observed “mobility” are not associated with slower growth of Covid-19 cases. Stay-at-home is associated with lower workplace and more residential activity, but common shocks matter much more. Moreover, job losses have been no higher in US states that implemented stay-at-home during the Covid-19 pandemic than in states that did not have stay-at-home. All of these results demonstrate that the Covid-19 pandemic is a common economic and public health shock. They also show that policy spillovers and behavioral responses are important. The tradeoff between the economy and public health in a pandemic depends strongly on what is happening elsewhere. This underscores the importance of coordinated economic and public health responses.

Suggested Citation

Lin, Zhixian and Meissner, Christopher M., Health vs. Wealth? Public Health Policies and the Economy During Covid-19 (May 2020). NBER Working Paper No. w27099, Available at SSRN: https://ssrn.com/abstract=3592176

Zhixian Lin (Contact Author)

University of California, Davis

Christopher M. Meissner

University of California, Davis ( email )

One Shields Avenue
Apt 153
Davis, CA 95616
United States

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