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- Post-vaccination world: Long-term Outlook for COVID-19 and Economic Activity #2
Post-vaccination world: Long-term Outlook for COVID-19 and Economic Activity #2
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Graduate School of Economics, Faculty of Economics, The University of Tokyo
Introduction
■Outlook for COVID-19 infection is highly uncertain, even in the short term
■Due to exponential nature of COVID-19 infection
■Long-term outlook is even more uncertain
■Uncertain enough that it will have little value as a "prediction"
■However, by looking at various scenarios, there is a possibility that "new awareness" will arise
■Guidelines on how to use model analysis
■"Three things to keep in mind when referring to our model analysis"
■https://covid19outputjapan.github.io/JP/disclaimer.html
■"(February 6) Explanation of the analysis of the standard for lifting the declaration of state of emergency and knowledge of model analysis utilization"
■https://covid19outputjapan.github.io/JP/files/Covid19OutputJapan_Note_20210206.pdf
■“(March 7) Policy analysis and proposals based on economic models”, “(March 7) Policy analysis and proposals based on simple models”
■https://covid19outputjapan.github.io/JP/files/FujiiNakata_Slides_20210307b.pdf、
■https://covid19outputjapan.github.io/JP/files/FujiiNakata_Slides_20210307c.pdf
■Please use it as a reference when discussing (1) what kind of future to aim for (goal setting) and (2) what should be done to realize that future (strategy)
About Simulations
■In this simulation, economic activities are incorporated into the SIRD model, and the risk of spread of infectious diseases and economic losses are analyzed simultaneously.
■The following parameters and predicted values were used in the simulation. Parameters are estimated before applying the model.
■Parameters
・Relationship between people flow and GDP
・Delta mutation rate (percentage of patients infected with delta variants among those positive)
・Severity rate (percentage of patients with severe symptoms among those who tested positive)
・fatality rate (percentage of deaths among those who tested positive)
・Hospitalization rate (percentage of patients with positive results who are hospitalized)
■Predicted values
・Changes in the number of newly infected patients per day (average number of infected patients from Monday to Sunday)
・Number of vaccinations per day
■Model Details Fujii and Nakata, “Covid-19 and Output in Japan", https://covid19outputjapan.github.io/JP/files/FujiiNakata_Covid19.pdf
Outlook for COVID-19 Infection and Economic
Activity for the Next 5 Years (Tokyo): Assumptions
■By the end of the year, it is assumed that most vaccination applicants will have completed the 2nd vaccination
■Applicant rates in the basic scenario
■Elderly: 90%, aged 13 to 64: 75%, aged 12 and under: 0%
■Of the entire population about 75% want to be vaccinated
■Under the following basic infection prevention effect, about 40% of the population (= 25 + 75 * 0.185) has not been immunized by vaccination
■Desired rates in the desired scenario
■Elderly: 95%, aged 13 to 64: 90%, aged 12 and under: 0%
■Of the entire population about 85% want to be vaccinated
■Under the following basic infection prevention effect, about 32% of the population (= 15 + +85 * 0.185) has not been immunized by vaccination
■Assumptions of effects of vaccination on infection prevention
■Basic Scenario: 1st dose 45%, 2nd dose 81.5%
■「SPI-M-O: Summary of further modelling of easing restrictions – Roadmap Step 4 on 19 July 2021, 7 July 2021」
■https://www.gov.uk/government/publications/spi-m-o-summary-of-further-modelling-of-easing-restrictions-roadmap-step-4-on-19-july-2021-7-july-2021
■Pessimistic scenario: 1st dose 45%, 2nd dose 70%
■Assuming that effects of vaccination on infection prevention decline over time, and additional measures to supplement it are not effectively taken
■It is quite possible that the decline in effects of infection prevention will be even faster and greater than this pessimistic scenario
Outlook for COVID-19 Infection and Economic
Activity for the Next 5 Years (Tokyo): Assumptions
■Assumptions of basic reproduction number
■3, 4, 5, and 6
■Note that there is great uncertainty regarding the "basic reproduction number after the COVID-19 pandemic"
■"The basic reproduction number of Delta variant is considered to be about 5-6 with the calculation that "the number before measures against infection were taken * 2 times (infectivity of Delta variant compared to the conventional variant)"
■About 4-5 is appropriate as "the basic reproduction number after the COVID-19 pandemic" that can be calculated with the past effective reproduction number in Tokyo and various human flow Measures
■This calculation explicitly considers the transition of Alpha and Delta variants and the pace of vaccination progress
■Nakata and Okamoto (2021) : The Basic Reproductive Number in Tokyo: Mobility-Based Estimates
■About 4-5 is consistent with "the estimated value of basic reproduction number in Japan before measures against infection were taken * 2 times"
■Kuniya (2020): Evaluation of the Effect of the State of Emergency for the First Wave of COVID-19 in Japan
■It is also consistent with "the estimated value of basic reproduction number in Wuhan before measures against infection were taken * 2 times"
■Note that the spread of technologies and customs that enable social and economic activities while keeping the contact rate low can be interpreted as a decrease in the basic reproduction number
Outlook for COVID-19 Infection and Economic
Activity for the Next 5 Years (Tokyo): Assumptions
■Three cases regarding the COVID-19 medical system
■Maintain the status quo
■Double the current capacity
■Assumptions about the current declaration of state of emergency
■Lifting the declaration at the end of October 2021
■Assuming that after the lifting, the economic activity will be recovered to pre-COVID crisis level over a six-month period
■Assumptions about future declaration of state of emergency
■Economic activity level during the declaration
■When the basic reproduction number is 4: In the basic and the desired scenarios, the decrease in economic activity is 0.9 times at the time of the second declaration (January 2021), and 1.1 times in the pessimistic scenario
■When the basic reproduction number is higher than 4: Set a larger decline in economic activity. By doing so, the number of infected people and the number of seriously ill patients will decrease during the declaration
■Assuming that after lifting the declaration, the economic activity will be recovered to pre-COVID crisis level over a six-month period
■Declared when the number of newly infected people exceeds X
■In each scenario, select X "so that the number of seriously ill patients (national standard) peaks out at about 1 or 2 times the current capacity when the basic reproduction number is 4"
■When 1 time / 2 times: declared at reaching about 7,000 people / declared at reaching about 12,000 people
■Declaration is lifted when the number of newly infected people falls below 1,000
*Criterias for severely ill patient
・metropolitan standard: Patients on mechanical ventilation or ECMO
・national standard: Patients requiring intensive care unit (ICU) management, ventilator management, or extracorporeal cardiopulmonary support (ECMO) management
Important points (1)
■Very high uncertainty about the future after vaccination is complete
■Uncertainty about important parameters in the model
■Uncertainty about what the correct model is
■Optimistic case
■Low basic reproduction number ・ many vaccination applicants
■The number of infected people who are not be captured by the number testing PCR positive is high, and many of them have acquired immunity
■Vaccine effect does not decline much, or policies are taken to supplement the decline
■System that can maintain normal social and economic activities even with a low contact rate
■In a very optimistic case, the gradual recovery of social and economic activities from the end of the year will not exceed the current medical capacity for COVID-19
■Pessimistic case
■High basic reproduction number ・ few applicants for vaccination
■Vaccine effect declines, but no policy is taken to supplement it
■System that cannot maintain social and economic activities with a low contact rate
■In a very pessimistic case, even if the medical capacity for COVID-19 is 2-3 times higher than it is today, severe restrictions on social and economic activities will need to be repeated many times over the next five years
Important points (2)
■Increasing vaccination rates not only reduce cumulative deaths, but also reduce economic losses
■Conclusions drawn from a comparison of the basic and desired vaccine scenarios
■If the vaccine infection prevention effect declines over time, the outlook for infections and the economy will worsen unless measures are taken to curb the decline
■Conclusions drawn from a comparison of the basic and pessimistic vaccine scenarios
■Strengthening the medical system for COVID-19 makes it possible to normalize social and economic activities without necessarily seeing an increase in the cumulative number of deaths
■Conclusions drawn from comparing the case of maintaining the status quo of the medical system and the case of doubling in each vaccine scenario
■Strengthening the medical system for COVID-19 = allowing an increase in the number of infected people without increasing the mortality rate
■Logic prior to the start of vaccination: "By controlling infections during the state of emergency, both cumulative deaths and economic losses can be reduced"
■Theoretical background of pre-vaccination logic
■Analysis of the lifting of the state of emergency in Tokyo (January to March 2021): https://covid19outputjapan.github.io/JP/tokyo_20210202.html
■Before the start of vaccination, controlling infections has the benefit of "buying time until the arrival of a vaccine (and a resulting reduction in serious illness rate and mortality rate)"
■After vaccination is complete, this logic does not always apply
■If the vaccine effect declines, there may be a benefit of "buying time" until the 3rd vaccination
■If there is a possibility that an effective therapeutic drug will appear, there may be a benefit of "buying time" until its availability
■Spread of technologies and customs that enable social, economic, and cultural activities while keeping contact rates low will improve the outlook
■Conclusions drawn from the fact that the lower the basic reproduction number in each scenario / case, the better the outlook for infections / the economy
Points to keep in mind
■The number of cumulative deaths considers only "deaths due to COVID-19 infection"
■It does not take into consideration how strengthening the medical system for COVID-19 will lead to other conventional medical limitations and how much the limitations will increase the number of deaths from other causes
■It does not take into consideration the possibility that the number of suicides will increase due to the prolonged stagnation of social and economic activities due to the repeated declarations of state of emergency
■Batista, Fujii, and Nakata (2021) 「COVID-19 and Suicides in Japan」 contains the estimation of the additional suicide so far due to the COVID-19 pandemic
■The estimation of the number of seriously ill patients and deaths gives an incomplete consideration to the following factors
■If the proportion of newly infected people with breakthrough infections increases significantly, it would result in a decrease in the serious illness rate and mortality rate of all newly infected patients. This impact is only incompletely considered in this analysis
■The future deaths and seriously ill patients in this analysis may be too pessimistic
Long-term Outlook for Infection and the Economic Activity
Basic Scenario
<75% of the total population is vaccinated・infection prevention effect 81.5%>
Medical system: Status quo maintained

Note 1: Black·Blue·Red·Purple (Basic reproduction numbers 3, 4, 5, 6)
Note 2: There is a great deal of uncertainty regarding each case
Note 3: The number of deaths is the number if all patients are treated appropriately, otherwise the number may increase significantly
Medical system: Double the current level

Note 1: Black·Blue·Red·Purple (Basic reproduction numbers 3, 4, 5, 6)
Note 2: There is a great deal of uncertainty regarding each case
Note 3: The number of deaths is the number if all patients are treated appropriately, otherwise the number may increase significantly
Desired Scenario
<85% of the total population is vaccinated・ Infection prevention effect 81.5%>
Medical system: Status quo maintained

Note 1: Black·Blue·Red·Purple (Basic reproduction numbers 3, 4, 5, 6)
Note 2: There is a great deal of uncertainty regarding each case
Note 3: The number of deaths is the number if all patients are treated appropriately, otherwise the number may increase significantly
Pessimistic Scenario
<75% of the total population is vaccinated・infection prevention effect 70%>
Medical system: Status quo maintained

Note 1: Black·Blue·Red·Purple (Basic reproduction numbers 3, 4, 5, 6)
Note 2: There is a great deal of uncertainty regarding each case
Note 3: The number of deaths is the number if all patients are treated appropriately, otherwise the number may increase significantly
FAQ1
■Why is there another big wave of infection after vaccination is complete?
■The reasons are (1) the Delta variant is highly infectious, and (2) the vaccine is not 100% effective in preventing infection
■Followings are back-of-the-envelope calculation
■Basic reproduction number 2.5, vaccine infection prevention effect 100%
■2.5*(1- 100/100*X)<1
■1-X < 1/2.5、1- 1/2.5 < X、1- 0.4 < X
■X > 0.6
■With a vaccination rate of over 60%, the number of newly infected people begins to decline
■Basic reproduction number 5, vaccine infection prevention effect 75%
■5*(1- 75/100*X)<1
■1- 0.75*X < 1/5、 1- 1/5 < 0.75*X、 0.8 < 0.75*X
■X > 1.06
■Even with a vaccination rate of 100%, the number of newly infected people does not start to decline
■The reality is more complicated. But above back-of-the-envelope calculation is valid to some extent
FAQ2
■Isn't it necessary to be concerned about the tightness of the medical system's capacity after vaccination is completed?
■Not always so
■Why?
■In the above basic scenario, about 4 million people in Tokyo will be unvaccinated after the vaccination of those who wish to be vaccinated
■Among them, the elderly: about 300,000. People aged 40-64: probably about 1-1.5 million
■The serious illness rate and mortality rate of them are high
■In addition, there will be about 2 million people who have been vaccinated but who have failed to obtain immunity
■The serious illness rate and mortality rate of them are 90% or 95% lower than those who have not been vaccinated
■But, this does not mean there are zero cases
■Considering that the infection prevention effect decreases over time, there is a good possibility that tightness of the medical system will occur in the long term
Reference materials
■Nationwide population ratio
■65 years of age or older: approx. 36 million
■13 to 64 years: approx. 73 million
■12 years and under: approx. 12 million
■Note: Excluding medical staff (4.7 million)
■Data Source:https://www.stat.go.jp/data/jinsui/topics/topi1251.html
■Population ratio in Tokyo
■14 years and under: approx. 1.6 million
■15 to 64 years: approx. 9.1 million
■65 years of age or older: approx. 3.1 million
■Note: Including medical staff
■Data Source: https://www.toukei.metro.tokyo.lg.jp/juukiy/2020/jy20qf0001.pdf
■Analysis updated weekly on Tuesdays
https://Covid19OutputJapan.github.io/JP/
■Questions, requests for analysis, etc.
■dfujii@e.u-tokyo.ac.jp
■taisuke.nakata@e.u-tokyo.ac.jp