Newswise — Fresh studies reveal that certain optimal measures to reduce COVID-19 death rates were not discovered within the emergency room, but rather within financial institutions.
An examination of COVID-19 mortality rates across 142 countries has unveiled an unexpectedly robust correlation between the availability of formal financial services and decreased COVID-19 mortality rates. Remarkably, it has exhibited an equivalent predictive power in reducing COVID-19 death rates as several underlying health conditions have in increasing them.
"The magnitude of the decrease is remarkably significant, comparable in size to the mortality risks connected with elevated rates of lung cancer and hypertension, albeit in the opposite direction," comments Todd Watkins, an economics professor and executive director of the Martindale Center for the Study of Private Enterprise at Lehigh University.
So, can we just “follow the money” to explain country-level differences in COVID-19 mortality?
Watkins clarifies that the situation is not so straightforward. Although certain financial factors appeared to have logical connections with increased mortality rates, other variables had unexpected and counterintuitive impacts.
As an illustration, one can observe that countries with greater income inequality exhibited elevated mortality rates, which aligns with basic reasoning. However, it is intriguing to note that countries with higher per capita incomes also demonstrated higher mortality rates, which appears to contradict intuitive expectations.
According to Watkins, the prevailing assumption among economists would be that wealthier nations and populations would be better equipped to handle the challenges posed by COVID-19 compared to their less affluent counterparts. However, the opposite has proven to be true with respect to GDP per capita.
According to Watkins, the availability of formal financial services, such as possessing a bank account, owning credit or debit cards, or having received loans from financial institutions, stands as a unique predictor that operates independently from other financial indicators.
This discovery suggests that formal financial services could potentially serve as crucial "shock absorbers" during times of crisis, enabling individuals and families to navigate health emergencies with greater financial resilience.
Watkins notes that the topic of financial services acting as a form of insurance during crises has received comparatively less research attention. While there are abundant studies on the impacts of insurance, such as Medicaid, Medicare, and universal health insurance programs in various countries, there is a scarcity of research on financial services that can effectively serve as insurance during times of crisis.
In the realm of studying the intersection of finances and public health, the prevailing focus tends to be on how health issues impact an individual's financial situation. However, it would be beneficial to "reverse the thinking" and examine the potential impact that financial services may have on a person's health. Shifting the perspective in this manner could provide valuable insights into understanding the relationship between financial well-being and overall health.
Additional research is necessary to investigate the effects of accessing various types of financial services on different health outcomes. Although the global health system experienced a significant disruption due to the pandemic, creating an opportune environment for study, Watkins suggests that further connections between financial services and health could potentially be identified in other health contexts as well.
"We have yet to truly delve into the extensive range of public health implications that formal financial services, at the primary, secondary, and tertiary levels, may hold," Watkins emphasizes. It is highly likely that there exist numerous unexplored connections and implications in the realm of public health that could be uncovered through deeper investigation.
The findings are published in an article, “The impact of access to financial services on COVID-19 mortality globally,” in PLOS Global Public Health.
- Listen to a podcast interview with Dr. Watkins about this research
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