A World Bank report estimated that the 2014 GDP toll, directly and indirectly, attributable to the recent Ebola outbreak in Africa will be between $2.2 billion and $7.4 billion. The viral outbreak has infected 14,000 people.
If so, what is the implied economic benefit—in terms of averted GDP loss—of health innovations that rid the world of the bubonic plague, which once killed an estimated one-third of the global population in 5 years, and smallpox, which killed an estimated 300 million people last century? What is the implied economic benefit of health innovations that now allow those infected with the human immunodeficiency virus (HIV)—which has killed 32 million people globally—to be able to live as long as uninfected individuals?
Earlier in 2014, a media furor arose over another virus, hepatitis C. As companies usher in the first curative drugs for this deadly viral pandemic that has already infected 130 million people globally, politicians are tripping over themselves in a rush to crucify the pharmaceutical industry on drug pricing.
While a debate rages about the cost of these drugs, it is also important to contemplate and calculate the implied GDP benefit—the health dividend, if you will—accrued by economies made healthier by these innovations. The public is generally unaware that they are collecting this health dividend because the human mind tends to overlook averted losses despite its significant economic value.