"If Quarantine Prolongs, Effectiveness May Weaken... Additional Economic Losses Could Occur"

On the 26th, Bank of Korea Releases 'Monthly Statistical Bulletin'... Analysis of the Relationship Between Quarantine Measures and Economic Costs
Psychological Relaxation Effects Such as Vaccination May Weaken Quarantine

On the 12th, when emergency fine dust reduction measures were implemented for two consecutive days across the Seoul metropolitan area, citizens wearing masks hurried on their way to work at Gwanghwamun Intersection in Seoul. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Jang Sehee] It has been forecasted that additional economic losses may occur due to prolonged quarantine measures amid the COVID-19 pandemic. Furthermore, if the overload of quarantine measures is accompanied by a surge in diagnostic and testing volumes and a shortage of medical personnel, these losses could expand even further.

On the 26th, the Bank of Korea analyzed the "Relationship between Quarantine Measures and Economic Costs during Infectious Disease Crises" in its Monthly Survey and Statistics Report. The report stated that while quarantine measures increase social welfare from a health perspective, they inevitably entail significant short-term economic costs.

In fact, during the first wave of the outbreak, private consumption rapidly contracted due to restrictions on external activities and weakened consumer sentiment. Employment was also significantly impacted by COVID-19, especially in the service sector. Looking at last year's labor market, the largest decreases were seen in accommodation and food services (-160,000 people) and wholesale and retail trade (-160,000 people).

Additionally, the report pointed out that if quarantine measures are prolonged, income may decrease due to employment insecurity among workers in face-to-face service industries, potentially increasing inequality from a distributive perspective.

As the end of COVID-19 is delayed, the report raised the need for more efficient and sustainable quarantine measures due to the accumulation of quarantine measures and related economic fatigue.

The report emphasized, "Since administrative quarantine inevitably involves economic losses, it is necessary to create conditions where voluntary quarantine can replace it," and added, "For the effective operation of medical and administrative quarantine systems, it is essential to recognize the importance of individual cooperation and voluntary quarantine."

It also stated, "Even after vaccination begins, there is a possibility that voluntary quarantine may weaken due to psychological relaxation effects, as seen in Israel or the United Kingdom," and "It is necessary to maintain mask-wearing and gradually adjust the speed of social distancing level changes."

This content was produced with the assistance of AI translation services.