Equitable vaccine distribution promotes socioeconomic benefits globally (preprint)

Ensuring a more equitable distribution of vaccines worldwide is an effective strategy to control the COVID-19 pandemic and support global economic recovery. Here, we analyze the socioeconomic effects - defined as health gains, lockdown-easing benefit, and supply-chain rebuilding benefit - of a set of idealized vaccine distribution scenarios, by coupling an epidemiological model with a global trade-modeling framework. We find that overall a perfectly equitable vaccine distribution across the world (Altruistic Age-informed Distribution Strategy) would increase global economic benefits by 11.7% ($950 billion) per year, compared to a strategy focusing on vaccinating the entire population within vaccine-producing countries first and then distributing vaccines to non-vaccine-producing countries (Selfish Distribution Strategy). With limited doses among mid- and low-income countries, prioritizing the elderly who are at high risk of dying, together with the key workforce who are at high risk of exposure, is found to be economically beneficial. We further show that such a strategy would cascade the protection to other production sectors while rebuilding the supply chains. Our results point to a benefit-sharing mechanism which highlights the potential of collaboration between vaccine-producing and other countries to guide an economically preferable vaccine distribution worldwide.

A Science-Policy Framework for a Green Economic Recovery After the COVID-19 Pandemic (preprint)

As current production and consumption patterns of humanity exceed planetary boundaries, many opinion leaders have stressed the need to adopt green economic stimulus policies in the aftermath of the COVID-19 pandemic. Here, we provide an integrated multi-stakeholder framework to design an economic recovery strategy aligned with sustainability objectives. We first employ quantitative energy and economic models and then design a multi-criteria decision process in which we engage social actors from government, enterprises, and civil society. As a case study, we select green recovery measures that are relevant for a European Union country and assess their appropriateness with numerous criteria related to socio-economic and environmental sustainability and resilience. Results highlight trade-offs between immediate and long-run effects, between economic and environmental objectives, and between expert evidence and societal priorities. Importantly, we find that a ‘return-to-normal’ economic stimulus is not only environmentally unsustainable but also economically inferior to most green recovery schemes.

Socio-Economic Impacts of COVID-19 on Household Consumption and Poverty (preprint)

The COVID-19 pandemic has caused a massive economic shock across the world due to business interruptions and shutdowns from social-distancing measures. To evaluate the socio-economic impact of COVID-19 on individuals, a micro-economic model is developed to estimate the direct impact of distancing on household income, savings, consumption, and poverty. The model assumes two periods: a crisis period during which some individuals experience a drop in income and can use their precautionary savings to maintain consumption; and a recovery period, when households save to replenish their depleted savings to pre-crisis level. The San Francisco Bay Area is used as a case study, and the impacts of a lockdown are quantified, accounting for the effects of unemployment insurance (UI) and the CARES Act federal stimulus. Assuming a shelter-in-place period of three months, the poverty rate would temporarily increase from 17.1% to 25.9% in the Bay Area in the absence of social protection, and the lowest income earners would suffer the most in relative terms. If fully implemented, the combination of UI and CARES could keep the increase in poverty close to zero, and reduce the average recovery time, for individuals who suffer an income loss, from 11.8 to 6.7 months. However, the severity of the economic impact is spatially heterogeneous, and certain communities are more affected than the average and could take more than a year to recover. Overall, this model is a first step in quantifying the household-level impacts of COVID-19 at a regional scale. This study can be extended to explore the impact of indirect macroeconomic effects, the role of uncertainty in households' decision-making and the potential effect of simultaneous exogenous shocks (e.g., natural disasters).

Global economic footprint of the COVID-19 pandemic (preprint)

Countries around the world have sought to stop the spread of the 2019 novel coronavirus (COVID-19) by severely restricting travel and in-person commercial activities. Here, we analyse the economic footprint of such “lockdowns” using detailed datasets of global supply chains and a set of pandemic scenarios. We find that COVID-related economic losses are largely dependent on the number of countries imposing lockdowns, and that losses are more sensitive to the duration of a lockdown that its strictness—suggesting that more severe restrictions can reduce economic damages if they successfully shorten the duration of a lockdown. Our results also highlight several key vulnerabilities in global supply chains: Even countries that are not directly affected by COVID-19 can experience large losses (e.g., >20% of their GDP)—with such cascading impacts often occurring in low- and middle-income countries. Open and highly-specialized economies suffer particularly large losses (e.g., energy-exporting Central Asian countries or tourism-focused Caribbean countries). Supply bottlenecks and declines in consumer demand lead to especially large losses in globalized sectors such as electronics (production decreases of 13-53% across our scenarios) and automobiles (2-49%). Although retrospective analyses will undoubtedly provide further policy-relevant insights, our findings already imply that earlier, stricter, and thus shorter lockdowns are likely to minimize overall economic damages, and that global supply chains will magnify economic losses in some countries and industry sectors regardless of direct effects of the coronavirus.