The paper discusses the difference between benefit-cost analysis and social welfare analysis in the evaluation of pandemic preparedness policies. Two social welfare approaches are considered: utilitarianism and prioritarianism. Benefit-cost analysis sums the individuals’ monetary equivalents of the pandemic impacts. Social welfare analysis aggregates individuals’ wellbeing impacts. The aggregation rule identifies the normative judgments about what is fair. The paper shows that the two methods yield very different estimates of the value of avoiding a future pandemic similar to the COVID-19 one. Compared to BCA, considerations about the distribution of the costs of the hypothetical intervention play a major role in the estimate of both utilitarian and prioritarian pandemic burdens: The more progressive the distribution of the costs is, the larger the benefits of preventing the pandemic. In contrast, the BCA pandemic burden is indifferent to the distribution of the intervention costs. In addition, BCA tends to underestimate the burden suffered by low-income countries compared to social welfare analysis.
