Topic: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources, Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.
2. Discuss the interrelationship between an outbreak of a disease and economy of a country while analyzing the case of recent outbreak of Corona virus. (250 words)
Reference: Indian Express
Why this question:
The outbreak of a new virus in China has sent shivers through world financial markets, with investors drawing comparisons to the 2003 SARS (Severe Acute Respiratory Syndrome) outbreak in order to assess its potential economic impact. Thus the question.
Key demand of the question:
Discuss in detail the impact of an outbreak of a disease upon the economy of the sufferer country in general and more specifically explain how it can lead to a sudden slump in the economy.
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.
Structure of the answer:
Start by mentioning the recent outbreak of Corona virus in China.
Start with fact – A 2017 paper by economists Victoria Fan, Dean Jamison and Lawrence Summers estimated that the expected annual losses from pandemic risk to be about $500 billion — or 0.6% of global income — per year, accounting for both lost income and the intrinsic cost of elevated mortality.
A paper by Jong-Wha Lee and Warwick McKibbin estimates the global economic loss due at SARS at $40 billion in 2003.
However, price action in markets indicates that the impacts of such outbreaks are limited.
After Chinese authorities reported the outbreak of SARS to the World Health Organization (WHO) in 2003, the MSCI China index of shares decoupled from its global peers – but made up the lost ground in only six months.
Explain that there are both winners and losers.
Despite the disruption to the wider economy, virus outbreaks have tended to benefit pharmaceutical stocks, while tourism and travel-related stocks — hotels, airlines and luxury and consumer goods — tend to get punished.
Discuss the case of China and corona Virus outbreak.
Conclude with what should be the way forward.