Restarting the economy while saving lives under Covid-19

Andrea Ichino, Carlo Favero () and Aldo Rustichini

No 14664, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We provide, calibrate and test a realistic model of the spread of SARS-Cov-2 in an economy with different risks related to age and sectors. The model considers hospital congestion and response of individuals adjusting their behavior to the virus’ spread. We measure precisely the size of these effects using real data for Italy on intensive care capacity and mobility decisions; thus our claim is that the tradeoffs we estimate are quantitatively, rather than qualitatively, approximately correct. We characterize the policies of containment of the epidemic that are efficient with respect to number of fatalities and GDP loss. Prudent policies of gradual return to work may save many lives with limited economic costs, as long as they differentiate by age group and risk sector. More careful behavior of individuals induced by the perceived cost of infection may contribute to further reduce fatalities.

Keywords: Covid19; Seir model; Post lockdown policies (search for similar items in EconPapers)
JEL-codes: D6 H84 I12 I18 (search for similar items in EconPapers)
Date: 2020-04
New Economics Papers: this item is included in nep-hea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (106)

Downloads: (external link)
https://cepr.org/publications/DP14664 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:14664

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP14664

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().