As efforts to contain the epidemic enter a critical stage, it is important to remember that the costs cannot be measured purely in economic terms, as the measures taken will have implications for life expectancy across the entire nation.
Analysis of historical data from various countries gives insight into the relationship between life expectancy and GDP per capita. In the first place, it is clear that countries with higher per capita incomes have longer life expectancies, owing to the ability and willingness of wealthier nations to invest in healthcare, infrastructure, and environmental governance, thereby increasing life expectancy and reducing fatality rates. Research suggests that, in general, a 100% increase in per capita income under similar conditions equates to an increase in life expectancy of 1-3 years. Over the past few decades, with the continued increase in per capita income in China, life expectancy has steadily increased in tandem. On the basis of this, we can make a conservative estimate that a 50% decrease in GDP would see a 1.5 year decrease in life expectancy. Thus, for each 1% reduction in in GDP, life expectancy will decrease by approximately 10 days.
This hypothesis can be tested against the economic theory of the "value of life". In the realm of economics, "value of life" is a relatively mature concept which refers to the amount that a society is willing to spend in order to increase the average life expectancy. Some will deem the notion of calculating a value for life to be cynical or even repulsive, as life is priceless. From an ethical point of view, this is entirely correct. In reality, however, whether in terms of work, business, or social management, a balance must be struck between reducing the risk of fatality and the cost of doing so. In order to identify this balance, a value for life must be calculated in a scientific, if seemingly ruthless, manner.
For example, some jobs inherently entail a far higher risk of fatality than others, such as underground mining and construction of ultra-high buildings. From the perspective of purely reducing the risk of death, these jobs should be eliminated. But in reality, doing so would both increase the unemployment rate and have adverse impacts on the natural progression of related work, and ultimately, society as a whole will bear the cost of underdevelopment. In this case, a more rational approach would see the introduction of stronger labor protections for such jobs. Finally, with an income premium determined by the market, high-risk jobs would be rewarded with higher salaries, and an acceptable balance may be achieved.
Similarly, enterprise and government must strike a balance between risk and cost in the provision of transportation infrastructure. For example, in designing a new road, governments can reduce the number of fatalities through the implementation of safety provisions, like extra lanes, non-motorized lanes, and wider sidewalks. Evidently, however, not all roads are built in this way. Does this mean that the designers of those roads had a disregard safety? Of course, this is not the case. Even if the proposed road is designed to be impeccably safe, should the cost be RMB 10 billion (approx. USD $1.4 billion), it is likely that the road will not be built at all, leaving people with no transportation infrastructure. Thus, for such construction projects, the government will issue minimum standards for safety, but it is up to the designer to determine the upper limit.
So, how much is a reduction in fatality worth? In determining this, an implicit calculation is made to strike a balance with the value of life. In fact, economists have long calculated the value of life in economic terms based on data from various countries. Generally speaking, the value of life in developed nations is between 10-100 times the GDP per capita.
Assuming that the value of life is calculated at 30 times the GDP per capita, the average life expectancy would be around 80 years, or approximately 30,000 days.
This inference can be tested by comparing the GDP per capita and life expectancy of different countries.
In terms of preventing and controlling infectious diseases, with reference to influenza numbers from previous years, in the absence of large-scale compulsory quarantine measures, the infection rate will not exceed 10% of the overall population, and the fat...
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