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Based on an appraisal of the contribution of air travel in the spatial diffusion of Covid-19 across the globe, I present a ballpark estimate of the cost-effectiveness associated with air travel restrictions at the height of the epidemic (mid-March to mid-April). In Gonne and Hubert (2020) we argue that the conclusions of a short-run cost-benefit analysis of travel restrictions highly depend on a handful of parameter values.
We derive from a Spatial Durbin-Watson econometric model that, on average, 8-9% of cases recorded domestically can be attributed to air traffic.
On the cost side, we estimate that a 4-week shutdown of the aviation sector represents an economic loss of USD 37 billion in OECD members and countries that host the 50 largest airports.
On the benefit side, a 4-week freeze in global air traffic means that 13,715 deaths could be avoided. If we take the monetary value of a human life suggested by the OECD of USD 3 million, the benefits amount to USD 44 billion.
Though a sudden stop of the flow of air passengers for a month would pass this back-of-the-envelope risk analysis, there is considerable uncertainty regarding the values of the parameters underlying the conclusion.
I provide a simulation tool below to illustrate the last point.
How to use the simulation tool: Drag the sliders below to change the parameters of the simulation. The simulation is based on Gonne and Hubert (2020), available here.
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