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COVID-19: Who suffers the most?

COVID-19: Who suffers the most?

Friday 17, 04 2020
“High-income workers tend to have a higher possibility of continue working, as well as having other sources of income besides wages.”

In a survey conducted by IGM Forum, which is a forum for well-known American and European economists, 44 experts received 3 statements regarding the impacts of COVID-19 on social inequality.

Statement: When the economy is locked, low-income workers who are above the poverty line suffer more income-related impacts than the high-income ones.

Statement B: When the economy is locked, the current inequality in educational access between low-income and high-income households will be more severe.

Statement C: Low-income workers have a higher death rate due to COVID-19. The question given to them was “To what extent do you agree/disagree with the statements above?”

The survey results

Regarding the first statement about whether low-income workers suffer more than the high-income one, 35% of the experts strongly agreed, 50% agreed, and 15% were uncertain.

Professor Aaron Edlin of Berkeley University agreed with the aforementioned statement: “Several people, especially workers without a labor contract, receive little to none of the 2 billion USD aid packages of the US Government.

The term “The more severe damages”, in this situation, includes both a higher seriousness and a more widespread scale, instead of including only the damages in quantity. Professor Larry Samuelson of Yale University said: “High-income workers tend to have a higher possibility of continue working, as well as having other sources of income besides wages.”

Daron Acemoglu of MIT University, who gave an uncertain answer, said: “Low-income freelance workers will be hit the hardest. The impacts will differ between the rich and the poor, but the Government’s program may tackle that”.

Abhijit Banerjee of MIT University was also uncertain about statement A. He explained: “I do not think income is a proper basis to compare the impacts of COVID-19 on the rich and the poor.

COVID-19: Who suffers the most?

If this were a question regarding the welfare of the two parties, I would have a different answer, as I think that low-income workers are extremely vulnerable in terms of welfare. Regarding statement B about whether COVID-19 might increase the inequality in educational access, 44% of the experts completely agreed, 48% disagreed, and 8% gave an uncertain answer.

Expert David Autor of MIT said: “The imbalance in PC/Internet access is only part of the problem. The ability to access online courses will be higher at households with higher income and educational level”. Professor Robert Hall of Standford University suggested: “As all schools, including the best ones, have closed, homeschool will depend majorly on the educational level of the parents”.

Richard Schmalensee of MIT also said: “Even though the educational system has become online, coffee shops and libraries have closed, resulting in students not having a high-speed Internet connection to study”.

For the third statement about whether the death rate due to COVID-19 of low-income people is higher, 50% of the experts totally agreed, 45% disagreed, and 5% were uncertain.

Daron Acemoglu of MIT said: “The proofs in New York seem to support this statement”. Expert Aaron Edlin of Berkeley University added: “Poor neighborhoods live closer together, therefore the risk of infection is higher while access to high-quality health care is lower than those of the rich people”.

Professor Austan Goolsbee at Chicago University said: "There is no need for any argument, as people can just look and see for themselves”.

​>> What workers need to do to overcome the COVID-19 crisis

Source: https://cafef.vn

Categories
Vietnam Economy

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