Wednesday, March 11, 2020

Coronavirus, Economy and A Fear Frenzy Behaviour

Chinese economy is already under huge pressure due to the ongoing economic slowdown and the trade war between the United States and China is escalating. The transmission of COVID19 virus in China has reached a contagious level that as per news reports China has to insulate the whole state of Hubei from rest of China mainland. It is going to cost the global economy in general and Chinese economy in particular. There are a few signals that suggest the same but those signals are very weak and will take longer to clearly indicate but it is certain that the world supply chain will be hit adversely.

There is already a fear factor that has started churning in India. Indian economy will also have to bear the brunt of this global pandemic as the cases of COVID19 infection are increasing and the numbers of affected states are also increasing. Considering the very high volume of international passengers arriving in India, this virus may spread quickly. However, at this juncture of time nothing can be said with 100% accuracy about what turns this pandemic is going to take; particularly in India.

Because of the peculiar nature of the Coronavirus caused influenza, the movement of goods and human capital will be adversely affected across the globe and hence the human confidence at global level will dip down. The scary news pieces relating to coronavirus have made humans psychologically afraid. This presumed fear does not seem to be uncalled for if the market is taken as a barometer. The oil and stock prices are now free falling across the globe. In India, Sensex has fallen by more than 5000 points in a few days. And most importantly, none knows where will it all stop? However, there is a pertinent question in this regard. Does the world need to have knee jerk reactions like this to the coronavirus pandemic?
From Table No – 1, it is clear that the mortality rate of the coronavirus induced influenza is the lowest among all the virus induced diseases in the last two decades. Till now total 1,15,331 persons have been infected and 4,021 persons have died from this virus as on 10th March 2020. However, it is too early to arrive at the final mortality rate of the coronavirus as the outbreak of coronavirus is expected to stay longer.
According to the Table No – 2, in terms of reproduction rate (R0), coronavirus is contagious but there have been many other viruses and diseases that have far higher R0 (Eisenberg, 2020). Measles has R0 in range of 12 to 18 and smallpox and polio have R0 in range of 5 to 7. So in terms of R0, coronavirus is not the most contagious disease. But of the other viruses that outbreak in last two decades, coronavirus has the highest upper band of reproduction rate. Perhaps that is the reason that till now coronavirus has travelled to almost half of the globe! There is no continent with a significant population where this influenza has not reached so far! So possibility of this virus reaching to most of the countries in the world cannot be ruled out.
As of 10th March 2020, out of total 1,15,331 cases, 4,021 persons have been dead from coronavirus infection (Worldometer, 2020). A look on Table No – 3 about the daily death from different diseases in 2017 (Ritchie & Roser, 2018), it is crystal clear that the numbers of deaths from many communicable and non-communicable diseases were far higher than that of the death from coronavirus. However, it is too early to predict the final number of deaths from coronavirus but considering the low mortality rate, it is expected that numbers of deaths wouldn’t be very high.
From Table No – 4 daily deaths from different diseases for many countries, the highest numbers of daily deaths in China at 28,036 followed by India at 25,270 in 2017. Similarly, depending on the population, every country had witnessed very high numbers of deaths from different diseases. So if the numbers of deaths from the coronavirus is compared with other diseases, it would be a small fraction of. In India, as of 10th March, there are just 44 coronavirus cases and no death. However, India is still at the early stage of coronavirus infection and numbers will increase for sure.

So, on account of mortality rate as well as the daily death from different diseases, coronavirus is not the deadliest disease. Even the reproduction rate (R0) is not the highest among all the diseases but among all the viruses that outbreak in the last two decades, coronavirus has the highest upper band of the reproduction rate and spread of this virus has been fastest and widest. So it is perhaps the most infectious influenza in written human history but not surely the deadliest one.

As far as the world’s knee jerk reaction to the coronavirus pandemic is concerned, at this juncture of time, it seems that the reactions of the world are not completely uncalled for but the way the panic button has been pushed, it seems that the fear is more than the worth. However, it is quite possible that this outbreak of coronavirus may really prove contagious and deadly to the world because the way China is withholding information about this virus and WHO has been less concerned, it must make everyone alert on this account.

Bibliography:-

  • Eisenberg, J. (2020, Feb 5). R0: How scientists quantify the intensity of an outbreak like coronavirus and predict the pandemic’s spread. Retrieved from The Conversation: https://theconversation.com/r0-how-scientists-quantify-the-intensity-of-an-outbreak-like-coronavirus-and-predict-the-pandemics-spread-130777 
  • Ritchie, H., & Roser, M. (2018, February). Causes of Death. Retrieved from Our World in Data: https://ourworldindata.org/causes-of-death
  • Worldometer. (2020, March 11). Coronavirus. Retrieved from Worldometer: https://www.worldometers.info/coronavirus/
- Rajeev Kumar Upadhyay

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