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COVID lessons: was there any way to reduce the negative effect of COVID-19 on the United States economy?

Mohammadreza Mahmoudi (Department of Economics, Northern Illinois University, DeKalb, Illinois, USA)

Journal of Economic Studies

ISSN: 0144-3585

Article publication date: 3 August 2022

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Abstract

Purpose

This paper aims to assess the economic impact of uniform COVID-controlling policies that were implemented by the US government in 2020 and compare it with hypothetical targeted policies that consider the heterogenous effect of COVID-19 on different age groups.

Design/methodology/approach

The author began by showing that the adjusted SEQIHR model is a good fit to the US COVID-induced daily death data in that it can capture the nonlinearities of the data very well. Then, he used this model with extra parameters to evaluate the economic effects of COVID-19 through its impact on the job market.

Findings

The results show that targeted COVID-controlling policies could reduce the US death rate and GDP loss to 0.03% and 2%, respectively. By comparing these results with uniform COVID-controlling policies, which led to a 0.1% death rate and 3.5% GDP loss, we could conclude that the death rate reduction is 0.07%. Approximately 378,000 Americans died because of COVID-19 during 2020, therefore, reducing the death rate to 0.03% means saving a significant proportion of the COVID-19 casualties, around 280,000 lives.

Originality/value

To the best of the author's knowledge, this paper is the first study to assess the economic impacts of COVID-controlling policies by using the multirisk SEQIHR model.

Keywords

Citation

Mahmoudi, M. (2022), "COVID lessons: was there any way to reduce the negative effect of COVID-19 on the United States economy?", Journal of Economic Studies, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JES-01-2022-0052

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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