Working Paper: NBER ID: w28031
Authors: Andrew Atkeson; Michael C. Droste; Michael Mina; James H. Stock
Abstract: We assess the economic value of screening testing programs as a policy response to the ongoing COVID-19 pandemic. We find that the fiscal, macroeconomic, and health benefits of rapid SARS-CoV-2 screening testing programs far exceed their costs, with the ratio of economic benefits to costs typically in the range of 4-15 (depending on program details), not counting the monetized value of lives saved. Unless the screening test is highly specific, however, the signal value of the screening test alone is low, leading to concerns about adherence. Confirmatory testing increases the net economic benefits of screening tests by reducing the number of healthy workers in quarantine and by increasing adherence to quarantine measures. The analysis is undertaken using a behavioral SIR model for the United States with 5 age groups, 66 economic sectors, screening and diagnostic testing, and partial adherence to instructions to quarantine or to isolate.
Keywords: COVID-19; screening tests; economic benefits; public health; behavioral model
JEL Codes: E60; I10
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| screening tests (C52) | number of deaths averted (J17) |
| screening tests (C52) | GDP increase (O49) |
| screening tests (C52) | federal tax revenues (H29) |
| confirmatory testing (C52) | net economic benefits (D61) |
| specificity of screening tests (C52) | adherence to isolation instructions (I12) |
| adherence to isolation instructions (I12) | economic outcomes (F61) |
| targeting screening to younger and middle-aged adults (J78) | economic outcomes (F61) |
| targeting screening to younger and middle-aged adults (J78) | mortality outcomes (I12) |