Tuesday, May 5, 2009

Flu economic impact

I'm sure that staying home if you're sick with pandemic flu is the best thing to do, both in terms of the spread of illness, and in terms of macroeconomic impact. If the disease burns quickly through the population, then hospitals can be overwhelmed, and if it's actually deadly, a lot more people will die.

But the problem is, a lot of people don't have sick leave. At all. If they stay home they don't get paid. And they don't eat.

On a macro scale, there are lots of businesses that would be screwed if we had to quarantine entire cities. I'm sure that museums and theatres in Mexico City are financially slammed by this, as well as all the sporting industry in Texas that shut down for the next 2 weeks. It's worth it, I'm sure. But it's a difficult price to be paid, and I believe it's an area where the government can help - mandating some minimal sick leave for employees, and even providing some stimulus money for businesses hurt by quarantine.

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