Is it really a pandemic?

Developed Countries, Percapita GDP, Enforced Poverty, Coronavirus

We reproduce a pie chart from the Worldometer downloaded on 2 May 2020. The pie chart depicts the percent share of corona-virus-infected cases by various countries. The countries with the highest rate of infections are presented in the table below. It says that only 17 out of the two hundred plus counties account for about 84% of all coronavirus cases in the world. Yes, only 17 countries. That is about 8% of the total number of countries. If we remove China and India from this list, we have 15 (7%) countries accounting for about 80% of all corona virus cases in the world. Is it world pandemic then? 

Let us look at it from the point of view of population share. These 17 countries account for about 53% of the world population. In other words, the remaining 47% of the world population account for only 16% of the corona cases. The top 15 countries (without China and India), accounting for only about 16.5% of the world population, have about 80% of the coronavirus cases. Shall we still call it a world pandemic? 

Distribution of Cases

Extracted: 2 May 2020

The politicians, the businessmen and the experts, without exceptions, have repeatedly expressed the devastating negative impact this virus would have on the international and national economies. Really?

We know that the degree of negative economic impact is dependent on the current economic standing of the nation. Thus, we cull out data on per capita GDP (in thousand USD) and richest country rank and present them in columns 5 and 6 respectively of the table below. We notice that 10 of these countries have per capita GDP more than the global per capita GDP. The per capita GDP of each of these 10 countries is substantially higher than the corresponding global number. Further, 10 of these countries have rich country rank up to 27, while nine of them are within the top 25 richest countries of the world. India, of course, is the poorest in this group of countries. From its rank of 107 and its per capita GDP of USD $2290, we can easily judge the predicament of the Indian economy. It does not require a genius to see that the economies of at least these 10 countries and some more will not be as gravely affected as that of India and its likes.

Table: Countries with highest shares of corona virus cases, their population share, per capita GDP, richest country rank, number of poor people.  Source: Worldometer.com, Wikipedia (World Bank), Statistics Times

To investigate who in India is impacted by this new (novel) virus, we now look at the number of poor people who are below the poverty line. We consider a minimum income of USD $3.20 per day, as suggested by the world bank, and a level prescribed by the respective national governments as the two measures for poverty line. The number of such people (in hundred thousand) are presented in columns 7 and 8 respectively in the above table. In India, there are about 83 crore people with daily income below USD $3.20 and about 30 crore people below the minimum income level as prescribed by the Indian government. These are hugely big numbers. The number of people affected in India is more than the total population of many countries in the list above.

Essentially, it is the richest countries that account for most of the infections and they can take care of the economic wellbeing of those who are impacted by the virus, directly or indirectly, in their own countries. 

In India, on the other hand, more than 30 crore poorest people would be devastatingly impacted, especially economically (due to the hardest and prolonged country-wide lockdown) and it will be extremely difficult to bring back the lives of these people to ‘normal’.  

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  Malay Bhattacharyya

  Malay Bhattacharyya is Professor of Decision Sciences, Indian Institute of Management Bangalore. His research interests include Quantitative Finance, Time Series and Extreme Value Theory.