Question

Explain why the socially optimal number of deaths from Covid-19 during the pandemic is probably not equal to 0. Then, discuss under what circumstances we could justify that the socially optimal number of deaths is in fact 0.

Answer 1

Socially optimum is the condition where is the level of allocation which provide social welfare. Every economy tried to attain this optimum level. The major conditions for social optimum level are invariant utility function of individual, individual tries to maximise their satisfaction, production at lower cost etc. If we are going to the COVID 19 death rate, socially optimum level is not equal to 0. We cannot find an optimal level for death due to this virus. Every day there are lot of people losses their lives. Not even a single country cannot determine the optimum level of their death rates. There is uncertainty exist in the world. There is no vaccinations were invented to prevent this. So the optimum level of death rate should not be equal to 0. The zero death rates represent no change or cost in the economy.
The circumstance were the social optimum is zero were the society acquire normal stage. The social efficiency restores its position with some positive externalities. The marginal social benefit becomes equal to the marginal social cost. The factors which hinder the benefit and cost create changes in the society.