Using a cost-benefit analysis, this paper assesses whether it is optimal for the United States to follow the lead of many European countries and introduce a nation-wide lockdown. Though COVID vaccines have been available since December 2020, the rate at which they are administered remains slow, and in the meantime the pandemic continues to claim about as many lives every day as the 9/11 tragedy. The author estimates that with the promised rate of vaccinations, if no additional non-pharmaceutical interventions are implemented, 203 thousand additional lives will be lost and the future cost of the pandemic will reach $1.3 trillion, or 6% of GDP.
A lockdown is shown to be optimal under a wide range of assumptions and parameter values. When the author uses a more conservative approach to valuing lives, using discounted qualityadjusted life-years that assign significantly lower values to the lives of older individuals, the author finds that a lockdown is still beneficial but that its optimal duration decreases to two weeks. When the author considers more conservative assumptions for the lockdown effectiveness, its incremental cost to the economy, and IFR, the author still finds that a lockdown would be optimal, albeit at a shorter duration in some specifications.