The outbreak of the pandemic resulted in an economic and financial crisis not seen since the Great Depression (1929-1929), which sparked diverse political discussions about the social utility of the measures. lockdownThe most recent data from the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD) show that countries that adopted more flexible measures... lockdown They experienced more severe GDP declines in 2020 – compared to countries that adopted measures. Zero covidIn this same context, emerging and low-income countries also experienced significant GDP declines compared to advanced economies. Thus, the data show that the measures of lockdown They were effective in achieving a faster economic recovery and better preserving public health in an overall context.
Health or the economy?
Philippe et al. (2021) state that the strict measures of lockdown They protect people and the economy more efficiently. According to the authors, countries that adopted stricter strategies to contain the virus experienced a less severe economic decline compared to countries that allowed the virus to spread to the point of collapse of their health systems during 2020. The table alongside demonstrates the performance of countries that adopted strict measures of lockdown (Zero Covid) and countries that adopted more flexible strategies.
Figure 1. Quarterly GDP variation compared to the same period of the previous year (%)
In this context, the authors point out that the countries that adopted the strategy Zero covid They had positive economic effects. The GDP of the countries Zero covid There was a slight decrease of 1,2% compared to 2019, while in the same period, the GDP decline among countries with flexible measures was greater at 3,3%. According to the authors, there was also a faster recovery in trade mobility between countries. Zero covidThe authors point out that the mobility data of Google Studies show that the flow of people in commercial areas fell less in countries that implemented the strategy. Zero covidDuring the second quarter of 2020, there was a 14% drop in the number of countries. Zero covid In comparison, 36% of countries have been flexible. The data also indicates that traffic in leisure, cultural, and accommodation areas fell by 14% between January and February 2021 in these countries. Zero Covid, while countries with flexible strategies experienced a 35% drop.
In this sense, studies by Philippe et al. (2021) indicate that countries that prematurely eased lockdown measures penalized the course of their societies and economies throughout 2020. According to the authors, this is a problematic factor for conducting business for companies that depend on significant social interaction (restaurants, hotels, and the culture, leisure, and recreation sectors), which have not been operating normally for months. In this way, stricter social containment provides better health protection for the population and brings about a faster recovery for the economy.
Most affected groups and advanced economies
Although thought-provoking, the analysis by Philippe et al. (2021) only captured the effects of sanitary strategies. made by advanced economies. Thus, the results presented by the IMF (2021) complete the authors' premises, demonstrating that emerging countries like Brazil had the largest drop in GDP per capita in 2020. This effect can be observed in the graph below, in which Emerging Economies (EE) such as Brazil, Russia, India, China and South Africa, showed the largest drop among the groups of countries compiled by the IMF.
Figure 2. Groups of countries most affected.
However, emerging countries were not the only ones that experienced sudden GDP declines throughout 2020. The fall in GDP per capita also affected advanced economies such as the member countries of the European Union (EU) and the Group of Seven (G7), which experienced sudden drops during the first quarter of 2020. Despite a strong recovery during the second quarter of 2020, the third quarter showed little growth for the G7 and negative growth for the EU. Data for the fourth quarter of 2020 have not yet been released by official sources such as the IMF and the OECD. However, a greater upturn is expected in developed economies during the fourth quarter of 2020 compared to the third quarter. This factor is estimated due to the effective distribution of Covid-19 vaccines in advanced economies.
Figure 3. Comparison of GDP Per Capita growth (%) – EU and G7.
Final Words
Data from the IMF and OECD, as well as studies by Philippe et al. (2021), state that the measures of lockdown The measures taken during 2020 were not detrimental to the economy. Countries that adopted stricter measures at the beginning of the health crisis (such as Australia, South Korea, and New Zealand) experienced less severe GDP declines compared to countries that relaxed social distancing measures. The Zero Covid measures primarily benefited a faster rebound in the real economy, with increased social mobility in commercial and recreational activities. Therefore, we can affirm that the measures of lockdown Stricter policies result in a faster recovery of economic activity levels. However, the results presented are only comparative, and it is not possible to state whether there are statistical correlations between GDP growth and these strategies. Zero covidImportant factors are also ignored in this type of analysis, one of which is the different patterns of social-urban organization and population size between different countries. For example, the strategies of lockdown In developed countries with small populations, such as New Zealand, the situation does not function in the same way compared to countries with high population density, such as Brazil or India. Also, education levels and social inequality play an important role in social behavior during times of crisis. Therefore, we must emphasize that this article is only a brief investigation to stimulate public debate so that society and governments can seek more robust and accelerated solutions to contain the pandemic.
