Goldman Sachs supports a national mask mandate to save economy. The firm said it could reduce coronavirus cases and save a 5% GDP hit due to lockdowns.
Jan Hatzius, Goldman’s chief economist, announced that they studied the link between mask wearing and health and economic outcomes due to Covid-19. Results show that wearing masks can lead to sizable and statistically substantial results.
“We find that face masks are associated with significantly better coronavirus outcomes,” Hatzius wrote in a note to clients. “Our baseline estimate is that a national mandate could raise the percentage of people who wear masks by 15 (percentage points) and cut the daily growth rate of confirmed cases by 1.0 (percentage point) to 0.6%.”
“These calculations imply that a face mask mandate could potentially substitute for lockdowns that would otherwise subtract nearly 5% from GDP,” the economist added.
He initially explored what extent, if at all, the actual use of facial coverings lowers the infection rate of Covid-19. The team investigated differences in population behavior by state. As an example, Hatizus identified only about 40% of respondents in Arizona who claim they “always” don facial coverings in public, compared with nearly 80% in Massachusetts.
Moreover, Goldman Sachs analzyed the potential impact of a national mask mandate. they studied the mask wearing policies issued by 20 U.S. states plus the District of Columbia between April 8 and June 24 and compared it to face mask usage using YouGov Covid-19 respondent data.
Goldman Sachs stated that the results are “large and highly significant” and disclosed that state mask mandates increase the percentage of people who say they “always” or “frequently” wear masks by about 25 percentage points in the 30 days after the implementation of policies.
GDP vs. lockdowns
In addition, the group of people who claim they “always” don masks rises by 40 percentage points more than 30 days after the mandate. Findings suggest the order motivates people who had previously said they “frequently” wear masks to “always” wear them.
Hatzius’ team also compared the severity of lockdowns to how the American economy has already responded to business closures.
Lockdown efforts, according to Goldman Sach’s estimates, subtracted 17% from US GDP between January and April. The firm’s analysis showed that a face mask mandate could potentially substitute for lockdowns that would otherwise subtract nearly 5% from GDP.
“If a face mask mandate meaningfully lowers coronavirus infections, it could be valuable not only from a public health perspective but also from an economic perspective because it could substitute for renewed lockdowns that would otherwise hit GDP,” Hatzius wrote.
Social distancing and wearing of masks found effective in reducing COVID-19 risk, according to a study published in the medical journal The Lancet.
When it comes to social distancing, the chance of virus transmission at a distance of less than 1 meter was 12.8%. However, that becomes 2.6% at a distance of more than one meter. What is more effective is distances of two meters. The veracity of the evidence appeared “moderate.”