The Economic and Long-Term Health Consequences of Canadian COVID-19 Lockdowns

To prevent exponential spread of COVID-19, many governments restricted economic activity through lockdowns. We model these restrictions as shocks to productivity by sector and trace total equilibrium effects across the economy using techniques from production network economics. We combine this economic model with an epidemiological model of income shocks to long-term health. On both long-run health and economic grounds, it is better to keep upstream sectors such as transportation, manufacturing, and wholesale open than consumer-facing sectors such as retail and restaurants.