Covid-19 Pandemic

The world now struggles to halt the spread of the novel coronavirus and the impacts are rippling through the global economy.  Sound risk management is more important than ever.  At the Wharton Risk Center, we engage with our partners to meaningfully support management of evolving threats, such as this one.  Risk Center resources and contributions from our scholars will be added to this page as made available.

Insights from our Researchers

Article | Underwriting Ecosystems: Using Insurance Policies to Conserve Nature

October 2020. Resources for the Future.

“The coronavirus pandemic has shown just how easily and unexpectedly zoonotic diseases can spread—and ecosystem degradation may be a driving force. To save disappearing habitats, RFF University Fellow Carolyn Kousky offers a novel solution: create insurance policies for nature itself.” Read this Resources article that connects a Duke Law Journal article by Executive Director, Carolyn Kousky, and Affiliated Scholar, Sarah Light, to challenges from the pandemic.

Op-Ed | How COVID-19 Can Help Improve Your Company’s Risk Management

September 2020. BRINK.

“While company managers have little control over the spread of the pandemic, they are responsible for managing the responses of their own enterprises. Based on a study of catastrophic risk management in a range of firms before the coronavirus, we suggest several courses of action for those facing COVID-19.” Risk Center Co-Director Howard Kunreuther and Affiliated Scholar Michael Useem discuss lessons presented in their book Mastering Catastrophic Risk in this opinion piece.

Op-Ed | Reopening schools and restarting the economy, done wrong, will be a disaster

September 2020. The Philadelphia Inquirer.

“A large body of empirical research has identified many cognitive biases and behavioral obstacles that compromise decision-making in the face of risk. Policy must be informed by the challenges these behavioral problems pose. For example, the coronavirus spreads exponentially, but we typically base our judgments on straight-line projections of early small increases, vastly underestimating the magnitude of the looming crisis.” Read more from Risk Center Co-Director, Howard Kunreuther, and the Center’s Risk Communication and Decision Making Lab‘s Affiliated Scholars Paul Slovic, and Harvey Rubin in this Op-Ed.

On September, 21, 2020, Howard Kunreuther, joined host Dan Loney on Wharton Business Daily for a follow up discussion on the risks associated with reopening schools and the economy amidst the COVID-19 pandemic. Listen here.

Article  | What Policies Address Both the Coronavirus Crisis and the Climate Crisis?

July 2020. Environmental and Resource Economics

The coronavirus pandemic has led many countries to initiate unprecedented economic recovery packages. Policymakers tackling the coronavirus crisis have also been encouraged to prioritize policies that help mitigate a second, looming crisis: climate change. In this article, Risk Center Affiliated Scholar and co-lead of the Business, Climate and Environment Lab, Arthur van Benthem and others identify and analyze policies that combat both the coronavirus crisis and the climate crisis.

Column  | A Better Remedy: Lawmakers must develop a public-private partnership to address insured losses from pandemics

June 2020. Best’s Review Risk Adviser.

The catastrophic impacts of the COVID-19 have presented challenges and opportunities for the insurance industry as to how to deal with business interruption (BI) losses by firms that did not have this coverage. This Risk Adviser column by Howard Kunreuther utilizes a framework developed at the Wharton Risk Center that proposes a private-public partnership to cover BI and other losses from future pandemics by businesses, the insurance industry and the federal government.

Essay  |  Catastrophic Risk Transfer in a Post-Pandemic World

May 2020. World Economic Forum.

Risk transfer tools have played a limited role in the pandemic, reflecting the fact that pandemics are too costly – to insurers and their customers. Still, there are lessons that can be learned from the risk transfer successes that have taken place during the pandemic. Read more about these lessons in this essay from Risk Center Executive Director Carolyn Kousky.

Op-Ed  |  Preserving Small Business in the Aftermath of the Coronavirus Catastrophe

May 4, 2020. BRINK.

Risk Center Executive Director Carolyn Kousky, Co-Director Howard Kunreuther and Senior Fellows Alexander Braun and Benjamin Collier offer their insights on public-private partnership opportunities and other policy approaches to business interruption due to the Coronavirus.

Op-Ed  |   Why We Need a Social Solidarity (i.e., Wealth) Tax to Recover from COVID-19

April 16, 2020. LinkedIn.

“While the $6.5b in philanthropic giving to the COVID-19 crisis has been heartening, it amounts to a drop in the bucket of the trillions of dollars that will be needed in short-, medium- and long-term crisis adjustment and recovery. Given the fiscal strains under which many national, state and local governments are already operating, new revenue sources will eventually be required.” Witold Henisz (Risk Center Senior Fellow) shares in his Op-Ed article on LinkedIn.

Op-Ed  |  How to fill a federal leadership vacuum: An interstate covid-19 compact

April 8, 2020. Washington Post.

Eric Orts (Risk Center Senior Fellow) and fellow Wharton professor Amy Sepinwall argue that an interstate compact would fill the vacuum of federal leadership. “States in a new compact would agree to uniform shutdown, quarantine and testing protocols. Their reward would be an interstate supply network that enhances their bargaining power and thwarts bidding wars and price gouging. The compact would increase access to testing, too.”

Podcast  |   Choiceology Bonus – Coping Amid the Crisis: With Guest Laurie Santos

April 6, 2020. Charles Schwab.

This special bonus episode of Choiceology with Katy Milkman (Risk Center Senior Fellow) looks to the science of happiness to see how we might mitigate the adverse impacts to our mental health and well-being—and maybe even cultivate good new habits that can help us when the crisis is over.

An edited version of Katy Milkman’s interview with Laurie Santos appeared in the Washington Post on April 20th. Read it here.

Op-Ed  & Podcast  |   What the Coronavirus Curve Teaches Us About Climate Change

March 26, 2020. Politico.

Howard Kunreuther (Co-Director of the Risk Center) and Paul Slovic (Risk Center Senior Fellow) compare the challenges of the coronavirus with those of climate change. “As with the coronavirus, we need to anticipate the climate crisis and act quickly and aggressively to minimize further damages before they overwhelm us.”

On April 7th, Dr. Kunreuther discussed this during an interview with Wharton Business Daily on Sirius XM. Read more or listen here.

The Behavioural Public Policy Blog featured this Op-Ed in a blog post on April 29th. Read it here.

Op-Ed   |   Can insurance lessen the economic costs of the coronavirus pandemic?

March 19, 2020. The Hill.

“While insurance typically provides financial assistance in response to a damaging event, innovative risk transfer solutions are now starting to be used to actually prevent a disaster or to halt cascading impacts in the economy.” Carolyn Kousky (Executive Director of the Risk Center) writes in this Op-Ed.

Interview   |   What does COVID-19 mean for your finances? 

March 18, 2020. The Philadelphia Citizen

Ben Keys (Risk Center Senior Fellow) is interviewed by The Philadelphia Citizen about the financial implications of COVID-19. “Policymakers need to communicate that any early efforts to keep the economy afloat are merely the start of their response, and be proactive about revisiting the size and scope of fiscal stimulus as this catastrophe plays out.”

Podcast   |   Coronavirus Disaster: Why Firms Should Lead the Recovery

March 3, 2020.  Knowledge@Wharton.

As the world reels under the shock, what role can companies play in leading the recovery from such disasters? Knowledge@Wharton discussed this question with Wharton management professors Michael Useem (Risk Center Senior Fellow), Tyler Wry, as well as George Washington University’s Luis Ballesteros. Their research indicates that corporations can play a positive role in the recovery from disasters like the coronavirus epidemic.

In The News

Coronavirus speeds up big oil’s shift to green.

August 6, 2020. Jakarta Post.

Article quotes Arthur van Benthem (Co-Lead of the Business, Climate and Environment Lab): “If I were an investor in oil and gas, I would be worried that I would be putting my money in an outdated and risky industry,” said Arthur van Benthem, an associate professor at Pennsylvania’s Wharton Business School.

COVID Business Interruption Suits Top 700 with More to Come

August 10, 2020. Insurance Journal.

Quotes Tom Baker (Affiliated Scholar). “Baker, an expert in insurance law and policy, showed an analysis of the numbers of business interruption coverage suits following past catastrophe events between 2009 and 2020—in particular, Hurricanes Ike, Irma and Harvey and Superstorm Sandy and COVID-19.

“They exceed the norm by two or three times all the nat cats,” he said, comparing the current level of COVID-19 cases in federal courts to the business interruption coverage suits filed after those natural catastrophes. “It’s a big deal,” he added, displaying line graphs with case spikes that rose to less than 100 for Hurricane Ike a year after the third-quarter 2008 event, and to roughly 150 a year later. For Sandy, Irma and Harvey, case filings were less than 100 in similar time frames.”

Monthly Loss of $431 Billion Spurs Insurance Claims Across U.S.

April 8, 2020. Bloomberg Markets.

Ben Collier (Risk Center Senior Fellow) quote: “They wouldn’t offer some of these contracts if they were required to cover pandemics,” said Benjamin Collier, an assistant professor in the risk, insurance and healthcare management department at Temple University’s Fox School of Business. “They wouldn’t offer business interruption insurance at all, or in cases where they might be willing to, they would charge substantially different rates.”

For additional recent quotes in the news from Risk Center scholars, please see our media page.

Coursework

Wharton School Launches New Course on the Impact and Implications of COVID-19

March 11, 2020.  Wharton Press Release.

Wharton has developed a new course entitled “Epidemics, Natural Disasters, and Geopolitics: Managing Global Business and Financial Uncertainty.”  The six-week, half-credit course begins March 25, 2020 via remote instruction.  Course lecturers associated with the Risk Center include Carolyn Kousky (Executive Director), Howard Kunreuther (Co-Director), Sarah Light (Senior Fellow), and Katy Milkman (Senior Fellow). 

Ongoing Research

Fighting COVID-19 Misinformation in India

Is eating Chinese food risky? Can cow urine protect from an infection? Can homeopathy ward the virus away?  These are examples of a few viral hoaxes surrounding COVID-19 in India. As the country battles extreme poverty, large crowds, densely populated areas and a stretched health system, the wave of inaccuracy about the virus that has flooded Indians’ phones has the potential to threaten millions of lives. Political Science doctoral student, Sumitra Badrinathan is conducting new research that tests interventions to combat COVID-19 misinformation in India. Her research will explore these questions:

  • Despite overwhelming scientific evidence to the contrary, why do pseudoscientific remedies to fight the virus abound social media in India?
  • Do cognitive biases motivate people to retain information congruent with their prior partisan and religious beliefs?
  • How can we effectively correct misinformed health beliefs,  particularly when they are rooted in tradition and difficult to change? Can targeted interventions that ease the distress caused by pressure to conform to belief systems or group norms motivate people to expend cognitive resources needed to correct misinformed beliefs?

Fundraising for an Effective Cause During an Unrelated Crisis

COVID-19 has disrupted nearly every aspect of daily life and captured the world’s attention. Governments, nonprofits, and individuals have directed billions of dollars to COVID-19 relief. Although these efforts are commendable, the attention to the pandemic likely overshadows the urgency of other causes for which donations translate to proven impact. In our research, we asked how organizations that provide effective aid can best remain relevant in donors’ minds, amidst a crisis that has consumed the media and donors’ limited attention.

Read the blog-post by 2019 Ackoff Doctoral Fellow, Josh Lewis, and his colleagues on the study, Amanda Geiser and Deborah Small.