Cross-Country Comparisons of Covid-19: Policy, Politics and the Price of Life

Abstract

Coronavirus has claimed the lives of over half a million people world-wide and this death toll continues to rise rapidly each day. In the absence of a vaccine, non-clinical preventative measures have been implemented as the principal means of limiting deaths. However, these measures have caused unprecedented disruption to daily lives and economic activity. Given this developing crisis, the potential for a second wave of infections and the near certainty of future pandemics, lessons need to be rapidly gleaned from the available data. We address the challenges of cross-country comparisons by allowing for differences in reporting and variation in underlying socio-economic conditions between countries. Our analyses show that, to date, differences in policy interventions have out-weighed socio-economic variation in explaining the range of death rates observed in the data. Our epidemiological models show that across 8 countries a further week long delay in imposing lockdown would likely have cost more than half a million lives. Furthermore, those countries which acted more promptly saved substantially more lives than those that delayed. Linking decisions over the timing of lockdown and consequent deaths to economic data, we reveal the costs that national governments were implicitly prepared to pay to protect their citizens as reflected in the economic activity foregone to save lives. These 'price of life' estimates vary enormously between countries, ranging from as low as around $100,000 (e.g. the UK, US and Italy) to in excess of $1million (e.g. Denmark, Germany, New Zealand and Korea). The lowest estimates are further reduced once we correct for under-reporting of Covid-19 deaths.

Keywords: Coronavirus; Covid-19; Modeling; Price of life; Valuation.

Fig. 1

Cumulative deaths (vertical axis) plotted for various countries (as selected for comparison in UK Government briefings) over approximately the first 100 days since each country recorded its fiftieth death (horizontal axis). Note that Spain’s apparent decrease in cumulative deaths around day 70 is an artefact of their reporting problems

Fig. 2

Observed and modelled deaths in the UK. Notes: The progression of the pandemic is divided into three time frames for each country: pre-lockdown (for the UK, before 23rd March), during lockdown (23rd March–11th May), and post lockdown (after 11th May). These time frames matter because the infection rate (R) changes as a result of imposing and subsequently easing lockdown. The posterior estimates for each period, and the 95% CIs are displayed on the graph