COVID Lessons: Was there any way to reduce the negative effect of COVID-19 on the United States economy?

Abstract

This paper aims to study the economic impact of COVID-19. To do that, in the first step, I showed that the adjusted SEQIER model, which is a generalization form of SEIR model, is a good fit to the real COVID-induced daily death data in a way that it could capture the nonlinearities of the data very well. Then, I used this model with extra parameters to evaluate the economic effect of COVID-19 through job market. The results show that there was a simple strategy that US government could implemented in order to reduce the negative effect of COVID-19. Because of that the answer to the paper's title is yes. If lockdown policies consider the heterogenous characteristics of population and impose more restrictions on old people and control the interactions between them and the rest of population the devastating impact of COVID-19 on people lives and US economy reduced dramatically. Specifically, based on this paper's results, this strategy could reduce the death rate and GDP loss of the United States 0.03 percent and 2 percent respectively. By comparing these results with actual data which show death rate and GDP loss 0.1 percent and 3.5 percent respectively, we could figure out that death rate reduction is 0.07 percent which means for the same percent of GDP loss executing optimal targeted policy could save 2/3 lives. Approximately, 378,000 persons dead because of COVID-19 during 2020, hence reducing death rate to 0.03 percent means saving around 280,000 lives, which is huge.