COVID 19 and the value of life

Having been born and brought up in a third world economy, India, whenever I used to hear about lawsuits in western world earning millions of dollars of damage for accidental deaths, or injuries, I used to marvel at how lucky the first world citizens were - that the state valued their lives and safety so highly. I would always wonder if there was a dollar value of that could be attributed to a human life in different countries. It was difficult to compute from lawsuit pay outs, as those would depend on specific circumstances of each case. Also, there typically would be a lot of emotions and sentiments at play, that cloud a rational decision in such cases.

The COVID 19 pandemic, its scale, and proliferation, finally gave me an easy opportunity to come up with a number on the value of a human life in various countries. Here's how -

In the US, President Trump has been unwavering in his intention of lifting the lockdown, given the overall business losses, and its consequent impact on the balance of power vis-à-vis China and other nations in the world.

The number of deaths due to COVID-19 in US has been projected by various people, and like all projections, they have come up with different estimates. However, a reasonable estimate, is about 0.3 % of the population would be impacted, if no steps were taken to contain the spread of COVID. So that would put the number of deaths at about 500,000.

The amount of stimulus money injected into the US economy to overcome the COVID impact is estimated at $6 trillion. From this, we can calculate the price of a human life in the US is $ 6 trillion by 500,000 or $12 million.

Similarly, for Spain, one of the countries that got impacted by Covid quite early on, the total number of people that were projected to die from COVID-19 was about 40,000. The industries immediately and visibly disrupted by Covid were tourism and sports-football, striking at the heart of Spanish culture and society. So, we can assume that the economic impact of the lockdown, to the extent that it forced a popular push to open up, is the GDP contribution of these two industries - about 13%, or $184.6 billion dollars.

So, the value of life of a Spanish citizen is 184.6 billion by 40,000 or approximately $ 4.62 million. Not bad.

What about India?

India also went into a COVID 19 induced lockdown, somewhat foolhardily. The government soon realized that more people would die of hunger and starvation with a lockdown than coronavirus could possibly kill, and this would not look good. So, before the rest of the world came to know about it, the Indian government quickly started to lift the lockdown and get economy back on track. What then, is the price of a life in India?

We have to compute it slightly differently for India - from the fact that India went into a lockdown in the first place, rather than from the decision to lift it. It is estimated that 400 million people in India really live at the borderline of malnutrition and starvation. Despite that India decided to go into a lockdown, knowing very well that such a move would finally push an additional 1%, or 4 million to a hastened death. And what would that save? Well, that would have saved the lives of 0.5% of the rest of India (the percentage here is kept deliberately higher than the US, given that the medical facilities are inferior). Now, it can be assumed that this particular population contributes almost the whole of Indian GDP, which is about $2.72 trillion. And so:

The amount of money saved by getting into a lockdown is 0.5% of $2.72 trillion or $13.6 billion. The number of people imperilled by a lockdown decision: 4 million (due to starvation). From this, we can conclude that the price of life in India is $13.6 billion by 4 million or $3400.