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| DATE | 2020-05-20 |
| FROM | Ruben Safir
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| SUBJECT | Subject: [Hangout - NYLXS] Stay at Home Orders effectiveneness
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https://www.aier.org/article/stay-at-home-orders-and-the-willingness-to-stay-home/
Stay-at-Home Orders and the Willingness to Stay Home
AIER >> Sound Money Project >> Economic Trends >> Economic History
listpg_lutherWilliam J. Luther
– May 17, 2020
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There is much debate about the desirability of state-issued stay-at-home
orders. On one side, those in favor of lifting the orders argue that the
cure is worse than the disease. Some maintain that the disease is not as
bad as most experts claim. Others merely note the devastating
psychological and economic effects of isolation and reluctantly accept
that many lives will be lost from opening up.
On the other side, those in favor of the stay-at-home orders argue that
a few months of isolation is a small price to pay to save lives. Some
reject the idea of considering the trade-off when lives are on the line
altogether. Others deny the trade-off on the grounds that mass
casualties would have an even bigger negative effect on our
psychological and economic well-being.
If there is one thing that both sides seem to agree on, however, it is
that state-level stay-at-home orders induced people to stay at home. In
fact, the available evidence indicates that much of the change in
activity occurring in March resulted prior to the effective dates of
state-level stay-at-home orders.
In a new paper released last Friday, I analyze Google Mobility data and
find that 76.60 percent of the change in residential (+), 75.61 percent
in retail and recreation (−), 75.81 percent in workplace (−), 74.42
percent in transit station (−), and 19.58 percent in grocery and
pharmacy (−) activity preceded state-level stay-at-home orders. I also
estimate that 67.54 to 86.13 percent of the decline in park activity
resulted before state-level stay-at-home orders were imposed, though the
estimates for the decline in park activity before and after stay-at-home
orders warrant less confidence.
The magnitude of change resulting prior to state-level stay-at-home
orders implies that much of the consequences would have likely been
realized—for better or worse—even if states had not imposed stay-at-home
orders. In other words, the marginal effect of state-level stay-at-home
orders, at least at the outset, was probably smaller than most people claim.
The evidence cuts both ways. On the one hand, it means state-level
stay-at-home orders probably had a modest effect on slowing the spread
of COVID-19. On the other hand, it means state-level stay-at-home orders
probably deserve little blame for reducing economic activity.
Why were state-level stay-at-home orders less effective than most people
think? There is much more empirical work to be done to be sure. But, in
large part, I think they were less effective because they came well
after many other steps had been taken. Many individuals had already
reduced unnecessary trips out. Many businesses had already moved to
remote work. Many local governments had already adopted stay-at-home or
limited capacity orders or required some businesses to close.
Democratically-elected governments are usually slow to respond. And
higher-level governments generally respond more slowly than lower-level
governments. That’s a feature, not a bug.
Governments can do great things. They can also do terrible things.
Constraining a government, by requiring its leaders to stand for
election, tends to reduce the speed at which it might do great things.
Elected leaders will generally wait until they are confident their
policies enjoy widespread support before enacting them. But it also
helps protect the citizenry from some of the terrible things a
government might do. Elected leaders will generally wait until they are
confident their policies enjoy widespread support before enacting them.
The compromise made at federal and state levels is made more tolerable
by local governments and a strong civil society. Local governments are
also constrained by democratic elections. But they need only wait until
the majority of those in their jurisdiction approves of a policy. As a
result, they tend to be more responsive to local conditions.
Civil society refers to our non-governmental, non-commercial
interactions. It is our families, religious institutions, and our social
clubs. It is the disapproving glance we give to a neighbor who doesn’t
mow his lawn. It is the smile and nod we give to the girl who helps
younger students cross the street safely after school. Civil society
does not work perfectly, to be sure. But it is capable of accomplishing
quite a bit.
It has become common, in times of crisis, to ask: what will the
government do to fix this? And there is certainly a lot that state and
federal governments can do. The lesson I hope we will learn from this
pandemic, however, is that there is much that can be accomplished
locally as well.
It begins with the choices we make as individuals and members of a
community. Be responsible. Praise those you see acting prudently; shame
those who impose unnecessary risks on others. But, in doing so, we must
also be very understanding when the line between prudence and
recklessness is unclear.
William J. Luther
listpg_luther
William J. Luther is the Director of AIER’s Sound Money Project and an
Assistant Professor of Economics at Florida Atlantic University. His
research focuses primarily on questions of currency acceptance. He has
published articles in leading scholarly journals, including Journal of
Economic Behavior & Organization, Economic Inquiry, Journal of
Institutional Economics, Public Choice, and Quarterly Review of
Economics and Finance. His popular works have appeared in The Economist,
Forbes, and U.S. News & World Report. He has been cited by major media
outlets, including NPR, VICE News, Al Jazeera, The Christian Science
Monitor, and New Scientist. Luther earned his M.A. and Ph.D. in
Economics at George Mason University and his B.A. in Economics at
Capital University. He was an AIER Summer Fellowship Program participant
in 2010 and 2011. William J. Luther on Facebook.
Get notified of new articles from William J. Luther and AIER.
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