Reanimating a Dead Economy: Financial and Economic Analysis of a Zombie Outbreak

Walking Dead, ©AMC

In this paper, we study the financial and economic implications of a zombie epidemic on a major industrialized nation. We begin with a consideration of the epidemiological modeling of the zombie contagion. The emphasis of this work is on the computation of direct and indirect financial consequences of this contagion of the walking dead. A moderate zombie outbreak leaving 1 million people dead in a major industrialized nation could result in GDP losses of 23.44% over the subsequent year and a drop in financial market of 29.30%. We conclude by recommending policy actions necessary to prevent this potential economic collapse.1

1. Names, characters, businesses, places, events, locales, and incidents are either the products of the author’s imagination or used in a fictitious manner. Any resemblance to actual persons, living, dead, or undead, or actual events is purely coincidental.

Visiting (the Costs of) ‘Westworld’

Westworld, ©HBO

The cost of building and operating a theme park on the scale of Westworld has been considered since the shows inception. CNBC published such a cost estimate by finding the revenue generated and computing the associated profits/costs from that figure back in 2016. However, in Season 2 we learned that the value of the park is not in the direct revenue stream from visitors but rather the data generated on the guests. This is the greatest market research that money can buy, or be paid for.

By point of comparison. The advertising revenue for Google was $134.81 Billion and for Facebook was $69.66 Billion in 2019. This is multiples of the $20.45 Billion revenue considered in the original CNBC analysis. As there is no clear scheme to monetize the data collected, we will assume that the data is worth the lower bound of these values, i.e., $70 Billion. Thus the total revenue is $90.45 Billion instead, an amount that would have otherwise taken over 4 years to accumulate by Delos Incorporated. Using the same computations from our favorite CNBC analysis, the $24 Billion of annual costs are now completely reasonable with an additional $66.45 Billion in which to pay other operating costs and from which to collect profits.

Now that a robot uprising and massacre has happened, the insurance premiums considered previously will spike as occurs after any large risk. The question is less whether Delos remains solvent following these events, but rather if Westworld would be able to afford to reopen its doors to guests. In short, would Delos be able to purchase insurance, and if not, what payouts would be expected every time an uprising occurs?

With the inherent risks of running Westworld now clear to the world, insurance premiums would likely be similar to flood insurance in the United States. That is, insuring against costly events causing extensive property damage that occur regularly. In order to keep areas prone to flooding affordable, the National Flood Insurance Program was established to provide insurance to private individuals and businesses. Without such a program for robot uprisings, it is unlikely any insurance company would be willing to underwrite any policy post-Season 2.

However, Delos could afford to keep Westworld open so long as guests still want to visit. The 9/11 attacks caused roughly $40 Billion in insurance losses. As the profits from the park are potentially over $65 Billion, this would be affordable so long as massacres occur less than 3 times every 2 years. And with that frequency the guests would surely stop arriving.

A Song of Ice and Economics

The Citadel
A Game of Thrones, The Citadel Library, ©HBO

The Grand Maester’s Conspiracy is that the Maesters have conspired over the centuries to destroy magic and manipulate historical records in Westeros for centuries. However, politics and economics go hand-in-hand. The Maesters have more control than anyone gives them credit, and it is all due to the white ravens sent out by the Citadel to announce the changing of the season.

Let’s take a step back from Planetos and consider Earth. Though our physical seasons are of fixed length and can be tracked accurately on a modern calendar; even before modern calendars the length of the seasons was well known and regular religious holidays were constructed to fit with the changing of the seasons. However, that which matches up to the seasons of Planetos on Earth are the economic seasons! The upturns and downturns of an economy, while obvious once a recession or recovery has begun, are still beyond our capabilities to predict when changes in economic climate will occur and how long they will last.

While this may seem a simple analogy to connect the citizens of Planetos to those of Earth, the business cycle *is* what occurs in Westeros when Winter arrives. Those Sweet Summer Children only know economic prosperity. Winter is coupled with famine and death from exposure. In fact, in an agrarian medieval society, the weather would be intimately connected with the economic welfare of the nation. Prosperity is coupled with good growing weather while economic downturns are, indeed, during winter.

While in the United States of America, for instance, we have the Federal Reserve which is tasked with regulating the economy, the Seven Kingdoms has no analog. The Master of Coin keeps the Iron Throne’s fiscal house in order and controls the minting of new Gold Dragons, but ultimately is not tasked with controlling unemployment. It would indeed be a conspiracy if anyone could control even a bit of the business cycle in Westeros due to its intimate connection with the weather. But, that is what the Maesters have been able to accomplish on a limited scale.

The Maesters, in their studies at the Citadel with their detailed histories of Westeros, would surely notice the deep connection that the state of people have with the weather. The first, obvious direction, that bad weather leads to a distraught populace is clear. However, the connection goes the other direction as well. Bold statements need bold evidence. Let’s consider 3 notable winters:

  1. A winter began during the the middle of the Dance of Dragons in 130AC, which was a particularly hard winter with the winter fever during this period as well.
  2. Another harsh winter lasted from 230-236AC, and during this period the 4th Blackfyre Rebellion occurred.
  3. Finally, the Year of the False Spring (281AC) occurred at the exact time of the Great Tournament at Harrenhal when when Rhaegar Targaryen “kidnapped” Lyanna Stark, which directly precipitated Robert’s Rebellion. Though the Maester’s hadn’t determined winter was over yet, everyone seemingly believed that was the case. Given that the “Year of the False Spring” needs no other descriptor, expresses how uncommon such an event is in Westeros.

The Maesters, who send distinct white ravens throughout the Seven Kingdoms to announce the change of seasons, could therefore control the business cycle by merely announcing that the season is changing. Just as choice words from the Chairperson of the Federal Reserve can precipitate economic changes, the sending of white ravens can cause people to despair (announcement of fall or winter) or become exuberant (announcement of spring or summer). But these have a secondary, pernicious effect, on the citizens of Westeros. At the coming of Winter, a negative supply shock will hit the agricultural markets as everyone hoards foodstuffs to survive or to profit off of inflated prices during the peaks of winter (as a result of everyone else’s actions). This latter effect can either deepen the economic/seasonal downturn or, in fact, precipitate it.

The Maesters certainly do not start all season changes. The current winter, with its linkage with the white walkers, is clearly beyond their control. But the power to control, even minimally, the seasons beyond the knowledge of the Iron Throne and Great Houses is a great power indeed. Such control can easily be used for accumulating and maintaining power. Were providing counsel to lords not sufficient to keep all houses following the desired order, a seasonal change could be called in with those symbolic white ravens that the common people would notice. During hardship is when counsel is needed most. If that counsel is to ignore best practices during a supply-side recession thus creating a stagflation period and undue hardship, who else has studied for years to argue the Maesters are wrong. The people, after all, won’t blame the Maesters. Truly knowledge is power. And enough knowledge is control.

Starkiller Base: A Star Wars (Economic) Story

Starkiller Base
Star Wars Episode VII: The Force Awakens, Starkiller Base, ©Lucasfilm LFL

In Star Wars Episode VII: The Force Awakens a new superweapon was unveiled. The so-called Starkiller Base was built into an ice planet. Based on its size and destructive capabilities, the costs for this fearsome base for the First Order could be astronomical. After all the much smaller sized Death Star cost the Galactic Empire on the order of $193 QUINTILLION ($193,000,000,000,000,000,000).1

Size of the Starkiller Base
Star Wars Episode VII: The Force Awakens, Starkiller Base and Death Star size comparison, ©Lucasfilm LFL

According to canon, the Starkiller Base has a diameter of 660km, which is verified by it having a diameter roughly 5.5 times that of the Death Star as depicted in Episode VII. As volume rises cubically with diameter, a first pass analysis would state that the Starkiller Base costs: $20.221 SEXTILLION ($20,221,000,000,000,000,000,000).2

However, though the Death Star was constructed from nothing, the Starkiller Base has an entire planet as its foundation. As such, calculating the costs of the Starkiller Base based on planetary volume is not appropriate. Instead, the excavation of the equatorial trench (wrapping around roughly 50% of the planet) would be the majority of the construction. This trench has an approximate depth of 10% of the radius (33km) and width of approximately 25% of the radius (82.5km). Thus the excavated volume is approximately 2,680,000km3. This leads to a cost of approximately $360 QUINTILLION, which is still significantly more expensive than the Death Star.3

The obvious first thought is whether the Starkiller Base would require additional costs as its weapon is able to destroy the entire Hosnian system from a great distance whereas both Death Stars required close proximity to the target and could only destroy one planet per shot. Ultimately this cost is kept comparable as the energy required is collected utilizing the resources provided by a nearby star. Holding onto the energy though should require further resources as the star is absorbed and stored before the weapon is used. To consider this, let us consider the geological makeup of the planet itself. With a diameter of 660km, the volume is 150,532,554 km3. Additionally, given the behavior of our heroes and villains on the surface of the Starkiller Base, there must be Earth-like gravity. Using Newton’s laws of universal gravity, the mass must be approximately 1.6 × 1022 kg.4 Thus the density of the Starkiller Base planet is roughly 106,338 kg/m3. This is just under 5 times the density of osmium, the densest naturally occurring element known to humans, and over 13 times the density of steel. With such high density it is likely this small planet was chosen specifically by the First Order for its ability to store dark energy. As such we can assume that costs are in line with size of the weapon system.

If, however, the planet were able to support life through its natural atmosphere, the costs would be reduced to approximately 2.59% of the total cost.5 That is, if the planet that the Starkiller Base was built into was able to sustain life, its total cost would be a mere $9.315 QUINTILLION or just 4.83% of the cost of the Death Star.

To determine the ability of the Starkiller Base to naturally support life, we need to determine its atmospheric conditions. Reportedly, the atmosphere is breathable, which indicates an Earth-like atmosphere of primarily nitrogen (N2) and oxygen (O2). For completeness we will also consider the average molecule in Earth’s atmosphere (dry air). In a galaxy with interstellar travel and the ability to terraform a planet these may need to be replenished and thus not reduce the costs. So the big question is surrounding the atmospheric escape on the Starkiller Base. This follows rules based on the Maxwell-Boltzmann distribution. In particular, we are interested in the probability that the atmosphere escapes naturally through molecules exceeding the escape velocity. Due to the size and mass of the Starkiller Base, we determine its escape velocity to be approximately 2544 m/s.6 With the Starkiller Base being built on an ice planet, but Rey, Finn, and Kylo Ren all seemingly comfortable on the surface, the temperature is seemingly near 0°C (or 273.15K).

Rey and Kylo Ren
Star Wars Episode VII: The Force Awakens, Battle on Starkiller Base, ©Lucasfilm LFL
Thus with molecular weight of 28 amu for N2, 32 amu for O2, and 29 amu for dry air, we conclude that the probability of molecular escape is so close to 0 to be negligible. Thus without the need for continuous injections of air into the atmosphere, the planet is self-sustaining.7

The only remaining concern is the atmospheric pressure at the bottom of the Starkiller Base trench. With the assumption that the pressure at the surface is 1 atm (i.e., comparable to Earth at sea level), which is implicit in the assumption that the atmosphere is sufficient to support life, then the pressure at the bottom of the trench is 62.3 atm. As 10 meters of depth in water corresponds to approximately 1 atm of pressure, this is about equivalent to a submarine at 623 meters. At this depth, modern American Seawolf class submarines are designed to operate. Since the Starkiller Base will primarily be constructed from the planet itself, the dense natural material (106,338 kg/m3) would act as the hull on a submarine keeping the humans safe.

TL;DR: The Starkiller Base costs $9.315 QUINTILLION or 4.83% of the cost of the first Death Star.

1. Assuming a diameter of 140km for the first Death Star. This has since been retconned to anywhere from 120km to 160km.
2. Starkiller Base cost = Death Star cost × (Starkiller Base volume / Death Star volume) = $193 QUINTILLION × (330/70)^3 = $20.221 SEXTILLION.
3. Excavation may be cheaper, especially as the extracted minerals can be sold for profit.
4. Newton’s laws state that planetary mass is equal to the square of planetary radius (330 km) multiplied by the acceleration due to gravity (9.81 m/s2) and divided by the universal gravitational constant.
5. It costs roughly 38.67 times more (pound for pound) to send a living human than lifeless cargo. The original cost computations assumed an artificial atmosphere would be required to keep humans alive, without that we can divide the cost for the Starkiller Base by 38.67.
6. Escape velocity is the square root of twice the multiplication of the acceleration due to gravity (9.81 m/s2) and planetary radius (330 km).
7. Water vapor would escape the atmosphere at a slow rate, but as must water would remain as ice on such a planet, this can be neglected without concern.

Rogue One and Building the Death Star

Building the Death Star
Rogue One: A Star Wars Story, Death Star, Ph: Film Frame, ©Lucasfilm LFL

With Rogue One officially coming out tomorrow, I wanted to revisit my paper from a year ago: It’s a Trap: Emperor Palpatine’s Poison Pill. Specifically, since this takes place before Episode IV, I want to look again at the costs associated with building the first Death Star and how that was used to calibrate the size of the Galactic Economy.

To deduce the costs of the Death Star being built in Rogue One, the first Death Star, I began by looking at the petition to the White House in which an estimated cost of over $850 QUADRILLION was given for building such a moon-sized battle station. However, going back through the sources, this value is only for the raw materials. Scaling up the cost from raw materials to the full cost changed that estimate by a few orders of magnitude, all the way to $193 QUINTILLION (that’s 193 followed by 18 zeros).

As evidenced by the discussions taking place in the trailers for Rogue One, the building of the first Death Star was a massive military research and develop project. Thus to use the cost of the Death Star to find the size of the Galactic Economy, I looked at history to find comparable projects. Ultimately I settled on a comparison to the Manhattan Project (building the first atomic bomb). That project cost 0.21% of US GDP per year from 1942-1946. As such, assuming the same cost profile, the Death Star’s $193 QUINTILLION would be 0.21% of the GGP [Gross Galactic Product] over its 20 year construction time. This leads to an estimated $4.6 SEXTILLION (21 zeros) in GGP per year on average. Sure makes the costs seem much smaller, though still big enough to damage the Galactic financial system.

We’ll just have to see if Rogue One has scenes in which Emperor Palpatine, Darth Vader, and Grand Moff Tarkin fret over the galactic finances in building this moon-sized battle station.

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