When President Donald Trump said in late March he didn’t think the economic devastation from stay-at-home orders was a good trade off for avoiding COVID-19 deaths, tweeting, “WE CANNOT LET THE CURE BE WORSE THAN THE PROBLEM ITSELF,” economists across the country already were busy working on the exact kind of cost-benefit analysis implied by the president.

They reached a very different conclusion from Trump.

Economists at the University of Wyoming estimated the economic benefits from lives saved by efforts to “flatten the curve” outweighed the projected massive hit to the nation’s economy by a staggering $5.2 trillion. Another study by two University of Chicago economists estimated the savings from social distancing could be so huge, “it is difficult to think of any intervention with such large potential benefits to American citizens.”

What these academics are doing — and what Trump’s tweet is getting at — is measuring how the extreme efforts to avoid COVID-19 deaths compare to the devastating economic fallout. They do this by putting a price tag on the deaths avoided. It’s something the federal government does all the time when deciding whether to require carmakers to install new safety features or drugmakers to add new warning labels. And it’s required by law for big-ticket new regulations, such as road safety laws and pollution controls.

But this kind of approach has been missing from the debate about how to respond to the COVID-19 pandemic, which has killed almost 100,000 Americans and fueled historic unemployment rates.

The calculation — known as Value of a Statistical Life or VSL — is the amount people are willing to spend to cut risk enough to save one life. The VSL at most federal agencies, developed over several decades, is about $10 million. If a new regulation is estimated to avoid one death a year, it can cost up to $10 million and still make economic sense.

The debate over letting the economy reopen or protecting more lives has become one of the many political fights dividing the nation. But a cost-benefit analysis using VSL, while far from perfect, would force policymakers to confront the reality of their decisions in a much more precise way. Without it, they are left to gut feelings, educated guesses or political arguments.


Two key federal agencies that previously have used this type of research to support policy decisions under Trump — including the Centers for Disease Control and Prevention and the White House Office of Management and Budget, which oversees federal regulations — say they are not using this type of cost-benefit analysis in their response to the pandemic.

“It’s missing from the discussion,” said Linda Thunstrom, an economist at the University of Wyoming, “so instead you have such loud voices on both sides — advocating that all lives should be saved or that, no, we need to open the economy. But there are trade-offs. It’s hard. But we should be talking about them.”

This type of research can help guide decisions about reopening businesses, resuming schools, identifying which social distancing measures are worthwhile and how to value a pandemic that seems to target older adults, economists say. It acts as a counterbalance to the easier-to-measure economic costs of fighting the virus, such as the Atlanta Federal Reserve’s projection that the nation’s gross domestic product could crater by nearly 43 percent during the current second quarter.

Economists have tried to answer the question “What’s a life worth?” by trying to calculate the “value of a statistical life” — literally the price of what people are willing to spend to lower odds of death.

“The dilemma here is, how do you value reducing the risk?” said Alan Krupnick, an economist at the think tank Resources for the Future and a former member of President Clinton’s Council of Economic Advisers, who studies the topic. “The economist’s answer is to ask people and observe their behavior.”

Economists use public opinion surveys on mortality risk. They look at how much more dangerous jobs pay. They study what people are willing to spend for safety devices, such as bike helmets. The information is then used to calculate VSL.


The Federal Aviation Administration used VSL to help judge whether to require pilots to train and test with flight simulators. The National Highway Traffic Safety Administration used it to calculate the savings from tougher standards for crush-resistant automobile roofs. The Food and Drug Administration used it to determine the savings from fewer adverse events resulting from new labeling on asthma inhalers.

In each case, the costs of complying with the new rules — installing flight simulators or strengthening SUV roofs — were concrete. The value of fewer deaths was not.

The COVID-19 pandemic offers a good opportunity for cost-benefit analysis, economists say, helping policymakers think through their reactions to what are eye-popping numbers on both sides — the economy and the death toll.

“There’s no getting around that COVID is a terrible thing that happened,” said Michael Greenstone, a University of Chicago economist who co-authored a study on VSL and the pandemic’s impact. “Now we’re just trying to figure out how to balance two difficult things — lives lost and incomes lost.”

But the CDC is not doing any cost-benefit analysis of the pandemic’s social distancing measures, agency spokesman Tom Skinner said.

The CDC is no stranger to this kind of research. CDC scientists in 2019 published a study looking at how the payoff from the fight against hospital-acquired infections is even bigger when taking into account the value of the lives saved.


The White House’s Office of Management and Budget said it wasn’t doing a pandemic cost-benefit analysis, either, according to an agency official who requested anonymity to discuss internal matters.

The White House Council of Economic Advisers, through spokeswoman Rachael Slobodien, declined to comment on whether it has looked into the issue.

Trump’s Council of Economic Advisers has used VSL before, to make the case in 2017 that the costs associated with the nation’s opioid crisis were “vastly” underestimated because they failed to account for the economic losses from overdose deaths.

In early May, the council hinted it was looking into the pandemic when it tweeted a chart that projected Americans would stop dying from COVID-19 by the middle of this month. But the chart tracked only the number of deaths — like a medical disease model would, staying silent on the economic costs of those deaths.

The chart was widely criticized for its mortality projection — which was wrong. More than 1,000 people a day are still dying from COVID-19.

The Wyoming economists sent a copy of their cost-benefit study to the White House advisory council, but they haven’t heard back, said Thunstrom, the university economist.


Their study looked at models projecting both the pandemic’s death toll, the effects of social distancing efforts and the economic impact. The study estimated the U.S. economy would shrink less from an uncontrolled pandemic (GDP declines by $6.49 trillion) than a pandemic curtailed by social distancing (GDP declines by $13.7 trillion). But social distancing would slash the peak infection rate in half, resulting in 1.2 million fewer deaths — leading to a VSL of $12 trillion. So the value of social distancing would work out to a net benefit of $5.16 trillion, the study estimated.

So far, the number of deaths has been lower than the study projected, Thunstrom said, “so social distancing has done more than what we assumed.” The benefits appear greater than expected. But the drop in GDP also appears worse than they projected.

“There’s still so much uncertainty,” she said.

The Wyoming study also noted potential costs from the lack of cost-benefit analysis: The public health savings might not be well understood, so the public focuses solely on job losses and declining GDP, potentially eroding voluntary compliance with valuable social distancing measures.

No one doubts the costs of social distancing are tremendous, Thunstrom said, but “the question is whether we think that cost is worth the lives we save from the policies.”

The pandemic offers many opportunities to study this trade off and make decisions about how the nation should react, said Krupnick, the think tank economist.

It could be the pandemic’s VSL should be even higher than the traditional government number of $10 million — and thus the efforts to avoid COVID-19 even more valuable.


The virus is dreaded, and studies have shown people are willing to pay more to avoid the risk of dying from cancer than an auto accident, Krupnick said.

And it’s contagious. VSL doesn’t capture what people would pay to avoid a disease that could kill someone else.

The extra pay offered to essential workers — such as grocery store cashiers and slaughterhouse workers — is a sign these workers believe their jobs are dangerous. That’s an argument for a higher VSL during the pandemic.

The government’s VSL also doesn’t reflect willingness to avoid injury, such as the strokes or breathing problems associated with COVID-19 cases.

But the most controversial aspect is whether older people should be assigned the same VSL as younger people. The Environmental Protection Agency in 2002 suggested a clean air rule would offer less of a benefit to senior citizens. Some academics agreed with the agency’s reasoning. But when critics decried it as a “senior discount,” it proved politically untenable.

That issue could be especially important in a pandemic that appears to be particularly deadly for senior citizens.

The Chicago study examined this point, using a VSL that declines with age — finding that even though about 90 percent of the benefit would go to saving the lives of people at least 50 years old, social distancing still makes economic sense for the nation as a whole.

But the federal government hasn’t publicly waded into the debate.

“I don’t think there’s any question that there’s a role for this type of analysis,” said Stephen Newbold, an economist who worked on the Wyoming study. “We need to make sure we’re not erring too far in one direction, one way or another.”