Sunday, May 3, 2020

Economic shutdown can kill, too

Drugs, Suicide, and Crime: Empirical Estimates of the Human Toll of the Shutdown | American Institute of Economic Research - Audrey Redford & Thomas K. Duncan:

March 28, 2020 - "As the coronavirus pandemic continues across the world, leaders and policymakers have scrambled to respond to the growing health crisis. In the United States, multiple state governors have issued statements urging their citizens to follow social distancing guidelines. Other governors have taken more extreme measures, issuing orders to effectively lock down the entire state economy....

"There have been forecasted estimates of virus-related death totals for the US from as high as 10 million, to 2.2 million, to more conservative estimates.... The models used to estimate the potential death rates are not without criticism and repeated adjustment.... However, as important as it is to get the cost of not shutting down right, it is also important that policymakers properly weigh the cost of the economic shutdowns themselves....

"[T]he ability to operate in a functioning economy is important for the people within it. The economy is the people, and the people are the economy. The ability to continue to function in a market system does matter to individuals within the system, particularly when the inability of business to remain open and continue to employ them is in question.

"We have already started to see some of these human effects as the unemployment has quickly rocketed beyond even the early initial projections. A rise in unemployment is correlated with a number of negative socio-economic effects. For some, these effects can be quite deadly....

"A 2017 NBER paper finds a 3.6% increase in the opioid death rate per 100,000 people for a 1% rise in unemployment. There were 14.6 opioid deaths per 100,000 in the US in 2018. If we use the more conservative estimate of a 20% unemployment rate without a quick return to lower levels, ... there is potential for an additional 28,797 deaths from opioids annually.... Consider that [in] 2018 ... 46,802 deaths were considered an opioid crisis....

"Similarly, Mulia, et al, (2014) connects a rise in alcoholism to economic loss during the Great Recession. The CDC estimates that 2,200 people die in the US just from alcohol poisoning annually.... In 2017 alone, there were also 22,246 deaths resulting from alcoholic liver disease.  As the jobless rate increases and the economic losses continue to mount, these numbers are likely to rise.

"Blakely, et al, (2003) find that being unemployed may also increase the risk of suicide two to threefold. Milner, et al. (2014) similarly finds that unemployment is associated with a higher relative risk of suicide, with prior mental health issues being a key factor in that association. While a study by Kerr, et al, (2018) did not find that unemployment is directly linked to suicides, it did find a significant link between poverty, suicide, and alcoholism.

"Lin and Chen (2018) ... find that unemployment does have a direct impact on older portions of the population, the portion of the population many of the current shutdowns are most meant to protect. Whether it is the direct unemployment effect or the potential poverty produced from the economic shutdown that leads to greater suicides, an increase from the 48,344 suicides and 1,400,000 suicide attempts in the US in 2018 should give decision-makers pause....

"Ajimotokin, et al, (2015) estimate that a one percent change in unemployment will increase the property crime rate by 71.1 per 100,000 people and the violent crime rate by 31.9 per 100,000 people.... Kposowa and Johnson (2016) find that unemployed workers are over 50% more likely to become homicide victims than those who are employed. They also find people not in the labor force to be 1.3 times more likely to be victims than those who are employed....

"The future during such a pandemic is largely uncertain, and misinformation is rampant in the current panic. Policymakers face tough decisions as they navigate the issues of data collection, virus transmission, and economic ramifications of doing too little or too much. It is vitally important, literally life and death, that the proper costs and benefits are weighed with the decision on how much and how long to shut down economic activity through the pandemic."

Read more: https://www.aier.org/article/drugs-suicide-and-crime-empirical-estimates-of-the-human-toll-of-the-shut-down/

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