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Slums and pandemics

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  • Brotherhood, Luiz
  • Cavalcanti, Tiago
  • Da Mata, Daniel
  • Santos, Cezar

Abstract

How do slums shape the economic and health dynamics of pandemics? A difference-in-differences analysis using millions of mobile phones in Brazil shows that residents of overcrowded slums engaged in less social distancing after the outbreak of Covid-19. We develop and calibrate a choice-theoretic equilibrium model in which individuals are heterogeneous in income and some people live in high-density slums. Slum residents account for a disproportionately high number of infections and deaths and, without slums, deaths increase in non-slum neighborhoods. Policy analysis of reallocation of medical resources, lockdowns and cash transfers produce heterogeneous effects across groups. Policy simulations indicate that: reallocating medical resources cuts deaths and raises output and the welfare of both groups; mild lockdowns favor slum individuals by mitigating the demand for hospital beds, whereas strict confinements mostly delay the evolution of the pandemic; and cash transfers benefit slum residents to the detriment of others, highlighting important distributional effects.

Suggested Citation

  • Brotherhood, Luiz & Cavalcanti, Tiago & Da Mata, Daniel & Santos, Cezar, 2022. "Slums and pandemics," Journal of Development Economics, Elsevier, vol. 157(C).
  • Handle: RePEc:eee:deveco:v:157:y:2022:i:c:s0304387822000499
    DOI: 10.1016/j.jdeveco.2022.102882
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    Cited by:

    1. Brotherhood, Luiz & Jerbashian, Vahagn, 2023. "Firm behavior during an epidemic," Journal of Economic Dynamics and Control, Elsevier, vol. 147(C).
    2. Bisin, Alberto & Moro, Andrea, 2022. "Spatial‐SIR with network structure and behavior: Lockdown rules and the Lucas critique," Journal of Economic Behavior & Organization, Elsevier, vol. 198(C), pages 370-388.
    3. Basu Parantap & Bell Clive & Edwards Terence Huw, 2022. "COVID Social Distancing and the Poor: An Analysis of the Evidence for England," The B.E. Journal of Macroeconomics, De Gruyter, vol. 22(1), pages 211-240, January.
    4. Hur, Sewon, 2022. "Comment on “COVID-19 in segmented societies” by Constantino Hevia, Manuel Macera, and Pablo Andrés Neumeyer," Journal of Economic Dynamics and Control, Elsevier, vol. 140(C).
    5. Hausmann, Ricardo & Schetter, Ulrich, 2022. "Horrible trade-offs in a pandemic: Poverty, fiscal space, policy, and welfare," World Development, Elsevier, vol. 153(C).
    6. Parantap Basu & Susmita Das & Arnab Dutta Choudhury & Ritwik Mazumder, 2023. "Why do urban people in India succumb to Covid 19 more? Investigating the Role of Lifestyle Disorder Disease," Working Papers 2023_03, Durham University Business School.
    7. J. Daniel Aromí & M. Paula Bonel & Julián Cristiá & Martín Llada, 2020. "Socio-economic status and mobility during the COVID-19 pandemic: An analysis of large Latin American urban areas," Asociación Argentina de Economía Política: Working Papers 4307, Asociación Argentina de Economía Política.
    8. Parantap Basu & Ritwik Mazumder, 2021. "Regional disparity of covid-19 infections: an investigation using state-level Indian data," Indian Economic Review, Springer, vol. 56(1), pages 215-232, June.

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    More about this item

    Keywords

    Covid-19; Slums; Health; Social distancing; Public policies;
    All these keywords.

    JEL classification:

    • E17 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Forecasting and Simulation: Models and Applications
    • I10 - Health, Education, and Welfare - - Health - - - General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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