This is an excerpt from an article written by Dr Ross Harvey and published online by IOL on 03 April, 2020.
“Black swans” are high-impact, low-probability events that are hard to predict. Covid-19 (or something similarly destructive), however, was not only predictable, it was highly predictable.
Of course, the contagion effect is impossible to predict without good data, which has sparked debates over what an optimal response might look like. Stanford epidemiologist John Ioannidis writes, for instance, that:
“In the absence of data, prepare-for-the-worst reasoning leads to extreme measures of social distancing and lockdowns … One of the bottom lines is that we don’t know how long social distancing measures and lockdowns can be maintained without major consequences to the economy, society, and mental health. Unpredictable evolutions may ensue, including financial crisis, unrest, civil strife, war and a meltdown of the social fabric.”
Indeed, lockdowns may be a necessary strategy precisely because we can’t predict the spread. Exponential growth initially looks deceptively linear. Nonetheless, there is no one-size-fits-all answer and each country has to assess the risks and opportunity costs of its respective policy decisions.