Healthy Public and Health Economy: Can You Have Just One, Both, or Neither During a Pandemic?
In March 2020, the WHO declared COVID-19 a pandemic and in response, countries around the world began closing their borders and shutting down businesses in an attempt to curb the spread of the disease. In the midst of countless countries closing, one nation stood out from the rest: Sweden. Instead of implementing strict lockdown measure like much of the rest of the developed world, Sweden chose to limit its restrictions to only banning public gatherings of more than 50 people and recommending people to frequently wash their hands, stay home, and practice social distancing. Sweden was seen as placing economic value over human lives, but its unique situation of not implementing any business shutdowns have not benefitted the economy as the government likely have hoped, as its economy saw the sharpest drop in GDP at the end of this year’s second quarter.
To fully understand Sweden’s public health and economic situation, we must first understand how a disease spreads and becomes a pandemic, as well as how cascades work. The spread of a disease’s depends on the properties of the pathogen that carries it as well as the network structures within the population that it is affecting. The key to preparing for a pandemic is to understand the basic reproductive number, Ro, (the product of p, the probability disease transmission, and k, the number of people a person comes in contact with), which tells us about the expected number of new cases of the disease in each new wave of infection. For a highly contagious disease such as COVID that is transmitted through air-borne particles, Ro was initially between 2 and 3 without intervention, so the disease would have kept spreading, explaining why governments worked to curb the spread by trying to lower k and discourage contact between people in networks.
In Sweden, because the government did not impose any strict measures to curb interaction between people, it saw some of the highest infection and death rates due to COVID in Scandinavia and in Europe. The government did not work actively to reduce k in the basic reproductive number equation model, which led to more infection rates than other comparable countries in terms of population size, and the people were greatly affected. Sweden’s hospital bed capacity now is close to reaching maximum levels, creating a public health crisis.
The bad economic performance could be attribute to the cascading effect of other governments shutting down and Sweden’s dependency on foreign trade. If we treat adopting lockdown measures like adopting a new technology and assume that Scandinavia is a network cluster with strong ties, it’s clear how Sweden gained no benefit by being the odd one out. In beginning March, in Scandinavia, Denmark, the initial adopter, was the first to implement strict lockdown measures by shutting down every business, school, and government facility to curb the crisis. Finland and Norway soon followed suit, adopting stringent lockdown measures, and Iceland soon after that. By all switching to the new “technology” – which refers to lockdown policies in this case – the other Scandinavian countries were able to gain a greater benefit of saving more lives and avoid the high human toll. Sweden did not follow the cascading pattern and experienced a high human cost.
The economy of Scandinavia can be portrayed as a network cluster with strong ties as well, as each are small, close-knit countries with open economies that are highly dependent on foreign trade. The economic performance of these countries also followed a cascading pattern, as one country’s economy shutting down eventually led to all countries’ economies shutting down. When Denmark, Finland, and Norway stopped their businesses, their domestic demand dropped, meaning that Sweden, despite keeping its economy and borders open, had no one to do business with. Everyone adopted a new economic policy/condition, and Sweden, despite not following that same economic policy, was not able to save its economy from the same fate that everyone else suffered.
In today’s world, countries, businesses, and people are more interconnected than ever. From common sense, from experience, as well as from the concepts we have learned in class, it is clear that when a highly contagious disease isn’t curbed immediately, it can quickly spread to the rest of the world. As for the response by individual countries or players, due to the connected nature of our society, one player will still feel a similar effect that others experience if others all conform to the cascade and make the same decisions. In Sweden’s case, it is extremely unfortunate that their attempt to save its people and its economy simply did not work.
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Articles referenced:
https://www.ft.com/content/ef9b05a1-dd8e-49cd-b1b1-47151c93aa41
https://www.businessinsider.com/coronavirus-sweden-gdp-falls-8pc-in-q2-worse-nordic-neighbors-2020-8
https://www.washingtonpost.com/world/2020/11/18/sweden-coronavirus-surge-policy/