The Long-Run Economic Costs of AIDS : A Model with an Application to South Africa

Bell, Clive ; Devarajan, Shantayanan ; Gersbach, Hans

Published by Oxford University Press on behalf of the World Bank

关键词: ACCOUNT;    ADVERSE EFFECT;    AIDS EPIDEMIC;    BENCHMARK;    BENCHMARKS;   

DOI  :  10.1093/wber/lhj006
RP-ID  :  77514

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Primarily a disease of young adults,Acquired Immuno Deficiency Syndrome (AIDS) imposes economiccosts that could be devastatingly high in the long run byundermining the transmission of human capital the maindriver of long-run economic growth across generations. AIDSmakes it harder for victims' children to obtain aneducation and deprives them of the love, nurturing, and lifeskills that parents provide. These children will in turnfind it difficult to educate their children, and so on. Anoverlapping generations model is used to show that anotherwise growing economy could decline to a low levelsubsistence equilibrium if hit with an AIDS type increase inpremature adult mortality. Calibrating the model for SouthAfrica, where the HIV prevalence rate is over 20 percent,simulations reveal that the economy could shrink to half itscurrent size in about four generations in the absence ofintervention. Programs to combat the disease and to supportneedy families could avert such a collapse, but they imply afiscal burden of about 4 percent of Gross domestic product (GDP).