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COVID-19 measures such as social distancing are justified despite economic hit

The benefits of social distancing policies will outweigh the economic costs by $5.2 trillion, economists find.

Jeff Lagasse, Associate Editor

Aggressive social distancing policies being used to slow the spread of the novel coronavirus COVID-19 are hammering the U.S. economy, but an analysis by University of Wyoming researchers suggests that these measures are economically justified.

The potential benefits of social distancing in saving lives far outweigh the projected damage to the economy, according to the economists from the Department of Economics in the UW College of Business.

In fact, assuming that social-distancing measures are adopted widely enough to substantially reduce contacts among individuals, the benefits of those policies will outweigh the economic costs by $5.2 trillion, the economists found.

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Attempts to slow the rate of COVID-19 infections have led many governments around the world to issue unprecedented public policies and guidelines to increase social distance within and across countries. Those measures include closing schools and businesses, imposing broad travel restrictions, and urging citizens to avoid gatherings of 10 or more people.

A recent forecast by Goldman Sachs predicts that these actions will cause the nation's gross domestic product to shrink by more than 6% this year, even with substantial government stimulus efforts. Already, the country is seeing declines in economic activity and dramatic increases in unemployment, with a particular impact on vulnerable low-income workers.

The UW economists' analysis takes into account the potential impact of COVID-19 on the U.S. healthcare system. Based on previous studies by other researchers, they estimate that the current social distancing measures across the country will reduce the average contact rate among individuals by 38%, which reduces the peak of the infection curve by more than half. This would help to avoid overwhelming the healthcare system and keep the mortality rate lower than the worst-case scenarios.

The economists note that their analysis doesn't examine the impacts of social distancing policies on specific segments of the U.S. population. In theory, the disparate impact of the epidemic and social-distancing measures could be addressed with appropriate redistributions of resources.

The analysis also doesn't consider how the current social-distancing measures might affect the probability of a second wave of COVID-19 infections. "Instead, we implicitly assume that aggressive social distancing measures buy enough time to develop and distribute cost-effective COVID-19 treatments or vaccines, should a second wave occur," the economists wrote.


Social distancing measures in the U.S. are especially important given ongoing shortages of medical supplies and tests, which have hampered treatment efforts at healthcare facilities across the countries.

As of early April, 73% of U.S. physicians reported not being able to test patients quickly and easily for coronavirus, while at least half say they have treated at least one patient with possible COVID-19 symptoms. Seventy-seven percent did not believe their hospital or clinic had adequate medical supplies or equipment to manage the crisis.

Twitter: @JELagasse

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