The costs and benefits of a COVID-19 lockdown

I’m supportive of the Government’s decision to lockdown the country. But I also believe decisions should be made on robust information, and ultimately all the decisions around the pandemic are weighing up benefits and costs of both action and inaction.

Martin Lally of Capital Financial Consultants has done a short paper looking at the potential costs, which I am publishing to allow informed debate.

The Costs and Benefits of a Covid Lockdown by David Farrar on Scribd

I’d note that one issue is that even if a Government doesn’t go for a suppression strategy, there will still be a drop in economic activity due to the actions of other countries, and many people deciding not to travel, shop, eat out etc.

But of course it would be less than the economic cost of suppression.

After this is all over, we should have a Commission of Inquiry to look to whether our responses were the best ones, were there better alternatives, and what might we do differently in future. The aim is not to cast blame, but to learn.

Some people may not like an analysis that puts a value on human life but this is commonly done for road safety and ACC etc. Also worth remembering that there is a very real toll on families who do end up with members losing their jobs, their incomes, maybe even their houses etc. So it is important to always focus on benefits and costs of all options.