The economy affects all of us. If we’re unable to pursue our regular activities, many things no longer function. Even with the restrictions imposed by the federal government so far to curb the coronavirus pandemic, life seems to have come to a standstill for many people. But merely maintaining this “standstill” requires countless economic activities in the background.
Food supply, logistics, and healthcare all continue to function not on their own, but because various industries are keeping their operations going. In a highly complex society like ours that’s based on the division of labor, simply bringing the entire economy to a stop is unthinkable. There are just too many interdependencies. Nevertheless, there are mounting calls in Switzerland for a comprehensive economic shutdown along Italian lines. In this analysis we calculate the costs of such a thoroughgoing measure: on the basis of conservative assumptions we would have to reckon with losses of almost CHF 29 billion a month in value creation, around 4.3% of gross domestic product (GDP). Extrapolated over a whole year this means a decline by more than one half in all goods and services produced in Switzerland.
