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Covid-19 Lockdown Cost/Benefits: A Critical Assessment of the Literature

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  • Douglas W. Allen

Abstract

An examination of over 100 Covid-19 studies reveals that many relied on false assumptions that over-estimated the benefits and under-estimated the costs of lockdown. The most recent research has shown that lockdowns have had, at best, a marginal effect on the number of Covid-19 deaths. Generally speaking, the ineffectiveness stemmed from individual changes in behavior: either non-compliance or behavior that mimicked lockdowns. The limited effectiveness of lockdowns explains why, after more than one year, the unconditional cumulative Covid-19 deaths per million is not negatively correlated with the stringency of lockdown across countries. Using a method proposed by Professor Bryan Caplan along with estimates of lockdown benefits based on the econometric evidence, I calculate a number of cost/benefit ratios of lockdowns in terms of life-years saved. Using a mid-point estimate for costs and benefits, the reasonable estimate for Canada is a cost/benefit ratio of 141. It is possible that lockdown will go down as one of the greatest peacetime policy failures in modern history.

Suggested Citation

  • Douglas W. Allen, 2022. "Covid-19 Lockdown Cost/Benefits: A Critical Assessment of the Literature," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 29(1), pages 1-32, January.
    • Handle: RePEc:taf:ijecbs:v:29:y:2022:i:1:p:1-32
    DOI: 10.1080/13571516.2021.1976051
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    Cited by:

    1. Changcheng Kan & Qiwei Ma & Zhaoya Gong & Yuanjing Qi & Anrong Dang, 2022. "The Recovery of China’s Industrial Parks in the First Wave of COVID-19," IJERPH, MDPI, vol. 19(22), pages 1-15, November.
    2. Phoenix K. H. Mo & Yanqiu Yu & Mason M. C. Lau & Rachel H. Y. Ling & Joseph T. F. Lau, 2023. "Time to Lift up COVID-19 Restrictions? Public Support towards Living with the Virus Policy and Associated Factors among Hong Kong General Public," IJERPH, MDPI, vol. 20(4), pages 1-13, February.
    3. Gabriele Beccari & Matilde Giaccherini & Joanna Kopinska & Gabriele Rovigatti, 2023. "Refueling a Quiet Fire: Old Truthers and New Discontent in the Wake of Covid-19," CESifo Working Paper Series 10803, CESifo.
    4. Makridis, Christos A., 2022. "When houses of worship go empty: The effects of state restrictions on well-being among religious adherents," European Economic Review, Elsevier, vol. 149(C).
    5. Lopez-Medoza, Hector & González-Álvarez, Maria A. & Montañés, Antonio, 2023. "Assessing the effectiveness of international government responses to the COVID-19 pandemic," MPRA Paper 117826, University Library of Munich, Germany.
    6. Trunschke, Markus & Peters, Bettina & Czarnitzki, Dirk & Rammer, Christian, 2023. "Pandemic effects: Do innovation activities of firms suffer from long-Covid?," ZEW Discussion Papers 23-014, ZEW - Leibniz Centre for European Economic Research.
    7. Krzysztof Drachal & Daniel González Cortés, 2022. "Estimation of Lockdowns’ Impact on Well-Being in Selected Countries: An Application of Novel Bayesian Methods and Google Search Queries Data," IJERPH, MDPI, vol. 20(1), pages 1-24, December.
    8. Claudio Thieme & Víctor Giménez & Diego Prior & Emili Tortosa-Ausina, 2023. "Health vs. Wealth: A Cross-country Analysis of Managerial Effectiveness of the COVID-19," Working Papers 2023/10, Economics Department, Universitat Jaume I, Castellón (Spain).
    9. Wilson, Matthew S., 2023. "Social contact in a pandemic: Rationality vs. heuristics," Research in Economics, Elsevier, vol. 77(1), pages 159-177.

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