Assessing the macroeconomic burden of COVID-19

The COVID-19 pandemic, together with severe social distancing measures for keeping it at bay, have significantly slowed the production and consumption of most nonessential goods in much of the world. While economic activity is gradually re-emerging—at least in countries that suffered an early onslaught of the disease—the enormity of the present economic burden of COVID-19 is evident. Even more worrying, how long this burden may stretch into the future remains unclear. In this project, we calculate the macroeconomic burden of COVID-19 for a large number of countries worldwide based on a macroeconomic production function through which human capital (the labor force with various skills and education) and physical capital combine to produce gross domestic product. We employ epidemiological data on COVID-19 incidence, morbidity, and mortality and on medical treatment and care costs to assess the impact of COVID-19 on the labor force and the accumulation of capital. By considering scenarios that vary the intensity and duration of both the disease and lockdown measures we seek to provide a comprehensive picture of the economic burden different countries will face.


Team:  Michael Kuhn
Research Group:
  Economic Demography
Cooperation Partner:  Harvard School of Public Health - David E Bloom, Vienna University of Economics and Business - Klaus Prettner, Heidelberg Institute of Global Health - Simiao Chen