Complementarity, Congestion and Information Design in Epidemics with Strategic Social Behaviour

Davide Bosco () and Luca Portoghese ()
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Davide Bosco: University of Milan-Bicocca and Center for European Studies
Luca Portoghese: University of Pavia

No 218, DEM Working Papers Series from University of Pavia, Department of Economics and Management

Abstract: This paper studies how private information about health states affects social distancing behaviour in epidemics. We propose a social-interaction game where agents are rational and demographically heterogeneous, and the risk of death post-infection depends on demography. Self-tests and public screening campaigns jointly determine the available information. We find that private information determines how the spatial characteristics of the social environment affect agents’ strategic interplay: if private information is not available, social distancing decisions are strategic substitutes in any environment; if private information is available, complementarity arises in congestionable environments, and substitutability prevails otherwise. Policy implications ensue: if self-tests that detect illness are freely available, mass screening campaigns with tests that detect recoveries are beneficial in congestionable environments, but increase the death toll in the absence of congestion.

Keywords: COVID-19; Contagion; Social distancing; Collective action; Strategic complements and substitutes (search for similar items in EconPapers)
JEL-codes: C72 D71 H41 I13 (search for similar items in EconPapers)
Pages: 45
Date: 2024-04
New Economics Papers: this item is included in nep-gth, nep-hea, nep-mic and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:pav:demwpp:demwp0218

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