The total human costs of the disease won't be known for a while, but the economic costs are already mounting.
How much damage will the coronavirus, which started in the Chinese city of Wuhan a few weeks ago, do to our societies? The short answer is that nobody is yet sure. Because the disease is new, scientists don’t yet know how infectious it is, how deadly it is, or if it’s possible to cure it. The death rate currently seems to be around 2 percent, which is pretty high for this sort of disease (influenza kills about 0.05 percent of people who catch it), but that might be skewed by the fact that only the more serious cases have been identified, as people with mild symptoms might not even realise anything much is wrong.
What is clear is that even in a best-case scenario where the virus is quickly contained and an effective vaccine or treatment is discovered, the economic costs of this current outbreak are going to be huge. China has essentially quarantined a population equivalent to Italy’s and shut down much of the area’s public transport, stopping people from getting to work. Ordinary people are skipping trips to the cinema, restaurants or other public spaces for fear of getting infected. Tourism to China, and perhaps to other places if the disease takes hold there, is likely to drop massively.
At the moment, most of these economic effects are concentrated in China. But because that country is such a massive part of the economic system, any slowdown there will be felt around the world. Lots of businesses buy parts or products from China, and their supply chains are now under threat. Chinese people, businesses and governments are big buyers of stuff produced all over the world - so as they cut back, other places will suffer. Thanks to their population size and relative wealth, Chinese tourists are hugely important to tourism industries around the globe. Now the billions they spend abroad each year might dwindle.
Currently, most of this economic damage is not being caused by the coronavirus directly but is self-inflicted as countries ramp up protective measures. But if the disease turned into a global pandemic on the scale of the 1918 Spanish Flu (which infected a third of the world and killed three-six percent of it) it would add economic costs to the obvious human ones. People who are sick and dying, after all, tend to stop working and spending as much money. That would have various knock-on effects for companies around the world and the livelihoods that depend on them.
…So where next? Not only do economic ideas shape the institutions and communities we live in, they also influence our own ideas of personal success – be it earning well, achieving a ‘Dr.’ or ‘CEO’ at the front of our label, or living a sustainable life. But what with the speed at which technology is transforming our economies, we can barely predict what ‘s in store for our economies and where we’ll fit in…