Coronavirus: Targeted lockdowns better for economy and health

Americans are paying a fearsome price for the government’s strict lockdowns of American life and commerce, and now comes evidence that targeted lockdowns aimed at protecting those who are most vulnerable to the coronavirus would be better for public health and the economy.

That conclusion comes in a new working paper from the National Bureau of Economic Research by MIT economists Daron Acemoglu, Victor Chernozhukov, Iván Werning and Michael Whinston. The authors compared relative risks of infection, hospitalisation and death for the young, the middle-aged and those over age 65. They then compared strict lockdowns that treat all age groups the same with a more targeted strategy that protects the old.

“Interestingly, we find that semi-targeted policies that simply apply a strict lockdown on the oldest group can achieve the majority of the gains from fully-targeted policies,” the authors write. “For example, a semi-targeted policy that involves the lockdown of those above 65 until a vaccine arrives can release the young and middle-aged groups back into the economy much more quickly, and still achieve a much lower fatality rate in the population (just above 1 per cent of the population instead of 1.83 per cent with the optimal uniform policy).”

Interesting is right. The universal lockdowns of March and April have been aimed specifically at preventing hospitals from being overrun with COVID-19 patients and thus reducing the death rate. But the paper says a targeted lockdown aimed at seniors combined with other policies like social distancing will reduce the death rate by more.

Targeted lockdowns also reduce economic harm, as you’d expect. “This policy also reduces the economic damage from 24.3 per cent to 12.8 per cent of one year’s GDP. The reason is that, once the most vulnerable group is protected, the other groups can be reincorporated into the economy more quickly,” the authors write.

This is consistent with the economic evidence we told you about last week from the University of Chicago’s Casey Mulligan.

The universal lockdowns are finally easing in many states, and the damage in the last two months can’t be undone. But these studies can inform governors as they consider how and what to reopen in their states. And in particular they should inform government decisions about the kind of lockdowns to reimpose if there are coronavirus flare-ups, as there are likely to be until a vaccine or cure arrive.

Protect the most vulnerable, but don’t put the entire state in economic cold storage in the name of a false choice between saving lives and saving money. On the growing evidence, targeted lockdowns can save more lives and more livelihoods.

The Wall St Journal