GDP Benefit of Health Innovations: The Health Dividend

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.

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.

Ebola and Secondhand Stress

Fear is contagious. Natural selection has wired us to sense fear in our surroundings and make it our own. Zebras might not get ulcers from chronic stress but those that fail to activate their acute stress response when others around them are stressed are more likely to miss cues of threat and be consumed by a predator. Absorbing secondhand stress from others is a survival instinct—an adaptation shaped by prehistoric environments to promote evolutionary fitness.

However, our culture is evolving faster than our ability to biologically evolve. Too often, we helplessly rubberneck trainwreck events—often sensationalized by media for attracting attention and profit—despite their remote connection to our personal survival.  For example, fear of the Ebola virus in recent weeks has become more viral than the virus itself. In the modern technology age where fear memes can spread around the globe near-instantly, our tendency to absorb secondhand stress from our ubiquitous, 24/7 media culture to activate our own stress response can produce maladaptive responses that are out of proportion to the actual threat.
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