On Aug. 22, the World Health Organization announced a draft strategy to combat the West African Ebola outbreak over the next six to nine months. That’s a sign that the global health body isn’t optimistic about a rapid end to an epidemic that has killed around 1,300 people so far. An extended outbreak of such a feared disease would have mounting economic costs: Already quarantines and concerns for worker safety have delayed mining projects and slowed rubber and palm oil output in Liberia, as well as cocoa, peanut, and rice production in Sierra Leone. Ebola helps illustrate the economic burden of infectious disease—particularly on countries in the developing world, but with affects felt worldwide. All of which suggests why increased support to fight infection in developing countries would have considerable global economic benefit.
Numerous studies have explored the social and economic impacts of infectious diseases. The University of Chicago’s Hoyt Bleakley examined the affect of the 1920s malaria eradication campaign in the U.S. as well as campaigns in South American countries in the 1950s. He looked at people born in areas particularly susceptible to malaria compared with people from other areas before and after the eradication efforts, and the impact of the campaign on their relative income and education levels. Bleakley found that higher malaria rates in the U.S. South before the 1920s accounted for somewhere around 10 percent of the income gap with the North. In Latin America, children born in areas of naturally high malaria prevalence after the antimalaria campaign earned approximately 25 percent more as adults than they would have absent the program.
The impact of AIDS in Africa provides a more recent example: Sebnem Kalemli-Ozcan of the University of Houston looked at African data over the past 15 years of the 20th century and found that AIDS had encouraged parents to have more kids (to ensure some survived), which had forced lower investment in each individual child’s education. High levels of HIV/AIDS prevalence in countries such as Congo saw the average woman having two more children and the average child getting 38 percent less schooling, than in countries in the region with low HIV prevalence, such as Madagascar.
The considerable costs of AIDS make even comparatively expensive treatments justifiable in economic terms alone. Harvard’s Stephen Resch and colleagues studied the economic returns to antiretroviral treatment provided to 3.5 million people in developing countries by the Global Fund to Fight AIDS, Tuberculosis and Malaria. Even at 2009 prices (higher than today), the cost of treating people with antiretroviral drugs was estimated to be similar to or below the economic benefits from increased labor productivity, fewer orphans to care for, and lower medical spending for related health conditions. That’s to say nothing of the nonfinancial benefits to children who wouldn’t lose their parents and the greatly enhanced life expectancy for those treated with the drugs.
The fight against AIDS is also a great illustration of what can be achieved when rich countries work with the developing world to help tackle disease. Expenditure on HIV/AIDS treatment may not be the most cost-effective way to save lives in Sub-Saharan Africa, but it is keeping millions of people from the grave. Alongside funding for drug provision—with leadership by the U.S.—global support for research and development has dramatically reduced the cost of a year’s worth of antiretroviral treatment. The combined affect of lower costs and higher spending was enough to turn a corner last year: More people were put on treatment than contracted the disease worldwide.
There are straightforwardly selfish reasons for rich countries to work with poor countries to eradicate infectious diseases. While Ebola in its current form is an unlikely candidate as a serious health threat to Americans or Europeans, other diseases, from AIDS to West Nile virus, are reminders that infections that start or survive in the developing world can become considerable threats to the health of people in wealthier societies. Reducing the risk of such diseases has a global benefit.
The fight against smallpox is a case in point. Annual expenditure on the global smallpox eradication campaign from 1967 to 1979 was $23 million. Since eradication in 1980, the U.S. has recouped nearly 500-fold the value of its contribution to that effort in saved vaccination and treatment costs. And although smallpox remains the only scourge to have been intentionally wiped off the face of the earth (minus a few refrigerators), global progress against other infections has been dramatic enough to save considerable medical costs the world over. The U.S. doesn’t regularly vaccinate against tuberculosis, typhoid fever, yellow fever, or cholera because rates are low enough at home and in nearby countries that the threat they pose is minimal.
That all suggests a considerable return to greater global investment in the fight against communicable conditions—including the guinea worm (already close to eradication), malaria (where there is progress on a vaccine), AIDS, and Ebola. Worldwide, infectious diseases still end about 15 million lives a year, and most of those deaths could be easily avoided. Beyond the incalculable benefits in terms of misery averted, the economic case for lowering that toll is overwhelming.
Source: Bloomberg Businessweek