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Immunity-driven comparative advantage and its palliative effect on social health and inequality

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  • Marjit, Sugata
  • Das, Gouranga G.
  • Kar, Mausumi

Abstract

We propose a model of “trade” between high-income and low-income groups where the rich, fearing the spread of infection hires the poor for exposure-intensive outdoor activities as workers in the household industry. The greater the inequality, with social distancing and herd-immunity during Covid-19 pandemic, the more would be such inter-personal exchanges increasing demand for top-skilled and gig activities. The general equilibrium model and econometric estimation support this view offering policymakers insights to assess the impact of such gainful exchanges for improving wage inequality in the developing nations where informal sectors cushioned the income-inequality effects unlike the developed countries without informalization.

Suggested Citation

  • Marjit, Sugata & Das, Gouranga G. & Kar, Mausumi, 2025. "Immunity-driven comparative advantage and its palliative effect on social health and inequality," Journal of Policy Modeling, Elsevier, vol. 47(3), pages 607-632.
    • Handle: RePEc:eee:jpolmo:v:47:y:2025:i:3:p:607-632
    DOI: 10.1016/j.jpolmod.2025.01.008
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    JEL classification:

    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • N30 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - General, International, or Comparative
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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