Does Social Distancing Matter?

University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2020-26

21 PagesPosted: 27 Mar 2020

Michael Greenstone

University of Chicago – Department of Economics; Becker Friedman Institute for Economics; National Bureau of Economic Research (NBER)

Vishan Nigam

University of Chicago

Date Written: March 25, 2020

Abstract

This paper estimates and monetizes the impact of moderate social distancing on deaths due to COVID-19 in the United States. Using the Imperial College simulation model of COVID-19’s spread and mortality impacts (Ferguson et al. 2020), we project that moderate social distancing would save 1.7 million lives between March 1 and October 1, with 630,000 due to avoided overwhelming of hospital intensive care units. Using the projected age-specific reductions in death and age-varying estimates of the value of a statistical life (VSL), we find that the mortality benefits of social distancing are over $8 trillion or $60,000 per US household. About 90% of the monetized benefits are projected to accrue to people age 50 or older. Overall, the analysis suggests that social distancing initiatives and policies in response to the COVID-19 epidemic have substantial economic benefits.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3561244