Page 29 - ES 2020-21_Volume-1-2 [28-01-21]

12 Economic Survey 2020-21 Volume 1

Figure 6: Early, Intense Lockdowns Controlled Mortality Due to the Spanish Flu

Source: Adapted from Markel et al (2007)
Note: New York and St. Louis used lockdowns promptly and were successful in increasing time to peak (A),
decreasing the peak mortality rates (B) and total mortality burden due to Spanish Flu (C and D). The 2 cities
represented by blue circles are outliers chosen to demonstrate that the associations shown are not perfect.
1.17 The economic effects of lockdowns could be both positive and negative. All else equal,
lockdowns constrain social interactions and thus dampen any economic activity that relies on
such interactions. While lockdowns lower economic activity, they have a salubrious effect by
delaying the temporal effect of a pandemic, reducing the overall and peak attack rate, reducing
the number of cumulative deaths, providing valuable time for production and distribution of
pandemic-strain vaccine and antiviral medication and decreasing the burden on health care
services and critical infrastructure. US cities’ strategy during Spanish flu demonstrated how
early and forceful lockdowns do not worsen the economic downturn. On the contrary, it was
established that cities who intervened earlier and more aggressively experience stronger recovery
in economic front in the long run.
1.18 Correia et al. (2020) use a dynamic difference-in-difference regression approach to
examine the impact of lockdowns on control of the Spanish flu and consequent effect on
economic activity across cities. The study found that cities that implemented lockdowns
for longer tend to be clustered in the upper-left region (low mortality, high growth), while
cities with shorter lockdowns periods are clustered in the lower-right region (high mortality,
low growth). This suggests that lockdowns play a critical role in attenuating mortality, but
without reducing economic activity and contribute to faster growth in the medium term
(Figure 7).