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Rotman Insights Hub | University of Toronto - Rotman School of Management

Thought leader interview: Anita M. McGahan

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Anita M. McGahan

You recently analyzed the policies put in place to fight the global pandemic. What were your key findings?

We looked at the effectiveness of 11 policies that have been implemented at various levels in 40 countries since the pandemic’s onset. My co-authors — INSEAD professors Phebo Wibbens and Wesley Wu-Yi Koo — and I found that a suite of widely implemented core policies did in fact reduce the spread of virus — but not by enough to contain it fully, except in a few highly compliant jurisdictions.

The 11 core policies we looked at included the cancellation of public events, the restriction of gatherings to fewer than 100 people, stay-at-home recommendations and the implementation of a partial international travel ban. For the average jurisdiction, these policies reduced the growth rate in new infections from an estimated 270 per cent per week to approximately 49 per cent per week. While that is an impressive reduction, it has not been enough to prevent ongoing transmission throughout the population. True virus containment only occurs when you reduce infection growth to below zero.

To achieve that, most jurisdictions would have had to implement three additional ‘difficult-to-tolerate policies, each of which had the potential to further reduce the weekly growth rate by 10 percentage points or more: targeted or full workplace closings for all but essential workers; strict stay-at-home orders; and targeted school closures.

You found that an effective portfolio of restrictive measures depended upon two things. Please explain.

An effective portfolio depended on a jurisdiction’s disease burden and the level of compliance of its citizens, which reflected behavioural and demographic characteristics. We found that a core set of ‘socially tolerable policies led to COVID-19 control only in places with unusually high levels of compliance. In 90 per cent of jurisdictions, these policies were insufficient on their own at preventing escalating growth in infections — and one or more policies from the difficult-to-tolerate list would have had to be implemented to achieve true control.

Overall, our analysis indicates that in all but a few highly compliant jurisdictions, relatively significant social costs must be incurred in order to reduce COVID-19 growth to below zero.

Of COVID-19 patients who are hospitalized, 90 per cent have no idea how they contracted it. Which locations have fared the best in controlling the virus?

As of our most recent analysis, the countries with the highest level of compliance were Belgium, Chile, Denmark, France, The Netherlands, and Norway. We didn’t run the analysis on Canada, but I do believe the Atlantic provinces would have made this list if we had. For all jurisdictions other than the ones just named, the core policies implemented were not enough to control the spread. They all needed to add one or more of the additional hard-to-tolerate policies.

Looking ahead to the coming months, as vaccinations ramp up, the biggest thing we can do next is targeted workplace closures — requiring closures or work-from-home for all sectors or categories where there is a high level of contact between workers. We believe workplace closings would have had the largest impact of any hard-to-tolerate policy. The second-most effective policy would have been strict stay-at-home requirements with exceptions made only for exercise, grocery, and essential trips. Again, this would have been very difficult for people to tolerate for long.

Targeted or full school closings throughout the pandemic would have had enormous long-term adverse consequences for our children. Basically, adults would have had to take on the burden posed by the first two difficult measures to avoid imposing them on our children.

You also found that the impact of testing and contact tracing has been lower than that of other policies. Why is that?

The challenge with testing has been twofold — and this has been analyzed quite deeply by my Rotman colleague, professor Joshua Gans, on his blog. The main problem is the lack of widespread accurate testing and the slow return of results. This has been the case since last March. And when it does occur, testing creates two classes of people — negative and positive. In general, our system hasn’t worked through all the issues of dealing with potential interactions between positive and negative people. Also, it’s very difficult to compel people to get tests when the potential news is so bad.

The second problem is that the psychological and emotional burden of contact tracing is high. Imagine that you test positive, and now you’ve got to reveal the names of the people you interacted

with over the past few days. You feel terrible that you may have exposed your family and friends. Having to give up names to the contact tracers is an impingement on your privacy — and you’ve got to do it while you are sick with an illness that can be very serious. The cognitive load from the responsibility, the guilt and the shame can be huge. It’s also very difficult to develop capabilities for doing contact tracing quickly enough to prevent further downstream transmission through your contacts. At this point, doctors are reporting that of the patients who are hospitalized, 90 per cent don’t know how they contracted it.

We also need to be able to take action based on contact tracing, which means a lot of people who are vulnerable need access to a place to isolate as well as income to cover their isolation, and we don’t have comprehensive systems for that. Contact tracing works best in concert with intensive testing in community environments where you can hit two home runs at the same time. For example, at small colleges where there is a strong boundary around the community; and in geographically-isolated communities. Also, workplaces where the workers are together most of the time, like in mining towns. Boundaries around a population allow for testing and contact tracing to be very effective.

The WHO has been under fire throughout the pandemic. You believe we can improve the global system by looking to a model from a rather surprising area. Please explain.

Our former dean, Tiff Macklem, is now governor of the Bank of Canada, but he was its deputy governor during the financial crisis of 2007-08. Along with other great Canadians, he created a Financial Stability Board in the midst of that crisis, working in concert with established financial institutions including the World Bank and the International Monetary Fund. When the pandemic hit, Tiff and I started to think about what a similar board would look like for healthcare.

I wrote an editorial in the Financial Times last May calling for an analogous institution called the Health Stability Board, which would work in much the same way. It would be designed to support the WHO, just as the FSB supports the World Bank. The WHO would continue to provide health policy recommendations and share best practices across jurisdictions, but the Health Stability Board would administer programs and provide the technical capacity to implement recommendations from the WHO.

Membership would consist of one individual per country. You might have, for example, the head of health and human services from the United States, and a provincial minister of health from Canada. There would be committees formed with representation from jurisdictions around the world, with regional bodies for some areas. There would be a committee on policy, for instance, to set global standards for healthcare capacity, resiliency, and planning. There would be a committee on vulnerability to assess emerging risks, hotspots and problems. And there would be a committee on standards implementation that would allow countries to coordinate and react very quickly — for example, in China, when COVID-19 first emerged. This Board would create global coordination and a more robust international structure for healthcare stability.

The pandemic has decimated the Arts sector. Can you talk a bit about the consequences for society?

This is something I’ve been thinking about with my Munk School colleague Shauna Brail and Massey College principal Nathalie Des Rosiers. Last June, we wrote about the potential consequences in Policy Options [For the Arts, The Show Must Go On, available online]. The Arts have always been chronically underfunded. It’s hard to think of an industry where workers are paid so little and yet contribute so much to our quality of life.

For the foreseeable future, we can’t go to concerts, we can’t interact at a theatre, we can’t be in public places to experience public art in the same way as we used to. There have been some very evident consequences of this: isolation, fear, widespread loss of motivation and inspiration. I was talking with a group of outstanding students recently, and they told me that after months of working from their dorm rooms, they feel totally unmotivated and uninspired. They’re really being taken down by this, and a lack of access to the Arts is part of it. Threats to the Arts are threats to our ability to engage, to our humanity, and to our collective consciousness. In Canada alone, 158,000 working artists were out of work in 2020.

We also know that the Arts are essential for entrepreneurship and business, tourism and the vitality of cities. Right behind the impact of school closures, I would say the biggest impact of the pandemic on children is via the brutal impact on the Arts. Reviving this sector must be a priority as we move into recovery.

You have said that if contact tracing is turned over to employers, it would change the economics of innovation. How so?

Say your employer takes this on, and God forbid, you test positive. They will want to know every single person you have interacted with for 15 minutes or more over the past two weeks. That gives them a tremendous amount of information about who you interact with, how you work, and what you do in your private time. That is of great concern to me. The second issue is, if employers are responsible for contact tracing, they will have an incentive to reassign jobs to people who are not likely to get serious cases of COVID-19 — like young people with no health issues. Also, in general, managing the health of employees creates enormous incentives for employers to automate tasks. These are just some of the potential consequences. In general, contact tracing by employers really reshapes incentives for firms to invest, grow and innovate.

Now is the time to ensure that we have less inequality and better environmental stewardship going forward.

Vaccines are rolling out as we speak. Are you hopeful that most businesses can get back on track this year?

I think we are at a crucial turning point in the choices we make about how to move forward. I wrote an article with Jason Sukhram for your fall 2020 issue titled, No Going Back: Threats and Opportunities Post-COVID (available online), in which we describe how much we have learned about ourselves during this pandemic — about the collective action that is possible, and our capacity to innovate and respond to a global threat.

In the months ahead, we are going to have to deal with the accumulation of a lot of long-overdue change that arose primarily from the industrial systems that shaped how our society is organized — our healthcare system, our financial system, our systems for education, manufacturing and so on. Many of these systems are very hierarchical and siloed because they were built on an industrial-era model of understanding processes and how things interact to create results.

These old industrial systems are partly to blame for this pandemic, because they didn’t allow for early enough detection or a coordinated response. They have also given us climate change, the centralization of wealth, and the other wicked problems that we currently face. We have to turn away from making the old ways of doing things more efficient in favour of using artificial intelligence (AI) to innovate at the foundations of society’s most important systems.

As we build back, we have an opportunity to use AI, machine learning and other techniques to support the values that are now paramount. At this point, we all recognize that computers can do structured analytics faster than most people can. But what can we do better as humans? Lots of things that are central to our future: human connection, empathy, relationships, to name a few. How can we redirect AI to support the things that are most important to us — like a reconceptualization of health that moves beyond fixing our broken parts and restoring us to the level of illness that we had prior to the diagnosis?

Now is the time to ensure that we have better health and education, less inequality and better environmental stewardship going forward. As the pandemic begins to resolve later this year, let’s not stop our collective action. It’s time to redirect the conversation to addressing these huge problems — and channel what we’ve been through during this pandemic towards building something better.

This article first appeared in the Spring 2021 issue of Rotman Management magazine. Published in January, May and September, each issue features thought-provoking insights and problem-solving tools from leading global researchers and management practitioners. Subscribe Today!

Anita M. McGahan is a university professor at the University of Toronto, a professor at the Munk School of Global Affairs & Public Policy and a professor of strategic management at the Rotman School of Management, where she holds the George E. Connell chair in organizations & society. Her PLOS ONE article, Which COVID Policies Are Most Effective? is available online.