National mask mandate could save 5 percent of GDP, Goldman Sachs research finds

5 min read
0
8
National mask mandate could save 5 percent of GDP, Goldman Sachs research finds

The dire situation in the United States has raised the specter of another round of state-level stay-at-home orders to halt the pandemic’s spread and caused a number of governors to pause or reverse their ongoing reopening plans. Against this background, a team of economists at investment bank Goldman Sachs has published an analysis suggesting more painful shutdowns could be averted if the United States implements a nationwide mask mandate.

“A face mask mandate could potentially substitute for lockdowns that would otherwise subtract nearly 5% from GDP,” the team, led by the company’s chief economist Jan Hatzius, writes.

It’s worth noting that the authors of the report are economists and not public health experts. Their primary motivation is to protect the economic interests of Goldman Sachs’ investors, which is why they’re interested in the effects of federal policy on gross domestic product. But their findings are in line with a number of other published studies on the efficacy of masks.

The Goldman Sachs report notes that the United States is a global outlier with respect to face mask use, which is widespread in Asia and currently mandated in many European countries. While the CDC “recommends” the use of masks in public and 20 states plus the District of Columbia have implemented their own mandates, there is no binding national policy, with wide regional variations in mask use around the country.

Using state-level survey data, the authors first demonstrate that these mandates increased mask usage in their respective states: “We estimate that statewide mask mandates gradually raise the percentage of people who ‘always’ or ‘frequently’ wear masks by around 25 [percentage points] in the 30+ days after signing.”

They then run a number of analyses at the county and country levels showing that higher rates of mask use are associated with lower rates of infection. U.S. county-level data suggest, for instance, that a statewide mask mandate cuts the growth rate of new coronavirus infections by 25 percent.

Country-level comparisons show a similarly large effect. “Our numerical estimates are that cumulative cases grow 17.3% per week without a mask mandate but only 7.3% with a mask mandate, and that cumulative fatalities grow 29% per week without a mask mandate but only 16% with a mask mandate,” the authors write.

Applying those figures to the entire U.S., the authors estimate that a nationwide mask mandate could dramatically slow the daily growth rate of new infections from roughly 1.6 percent to roughly 0.6 percent. To get an equivalent effect from an economic shutdown you’d have to subtract 5 percent from GDP.

Many public health experts stress that there’s no silver bullet for combating the virus. Most recommend adopting a range of measures, from mask use to physical distancing to the shutdown of certain high-risk activities, to slow the virus’ spread and save lives.

The Goldman Sachs study suggests that a nationwide mask mandate is a low-cost, high-efficacy measure to both prevent the spread of the virus and avoid some of the economic pain associated with a state- or nationwide economic shutdown.


Source link

Load More Related Articles
Load More In Business
Comments are closed.

Check Also

A Looming Contest For Unenviable Bank CEO Jobs

Just before markets turned in response to the spread of Covid-19, Lloyds’s stock price was…