Group-identity and long-run cooperation: an experiment

Gabriele Camera () and Alessandro Gioffré ()
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Gabriele Camera: Economic Science Institute, Chapman University and DSE, University of Bologna
Alessandro Gioffré: DISEI, University of Florence

Working Papers from Chapman University, Economic Science Institute

Abstract: The sudden appearance of the SARS-CoV-2 virus and the onset of the COVID-19 pandemic triggered extreme and open-ended “lockdowns†to manage the disease. Should these drastic interventions be the blueprint for future epidemics? We construct an analytical framework, based on the theory of random matching, which makes explicit how epidemics spread through economic activity. Imposing lockdowns by assumption prevents contagion and reduces healthcare costs, but also disrupts income-generation processes. We characterize how lockdowns impact the contagion process and social welfare. Numerical analysis suggests that protracted, open-ended lockdowns are generally suboptimal, bringing into question the policy responses seen in many countries.

Keywords: decentralized markets; random matching; contagion; nonpharmaceutical interventions (search for similar items in EconPapers)
JEL-codes: C6 D6 I1 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-exp
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:chu:wpaper:21-13

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