Altruism, social interactions, and the course of a pandemic

Laura Alfaro, Ester Faia, Nora Lamersdorf and Farzad Saidi

European Economic Review, 2024, vol. 161, issue C

Abstract: Externalities and social preferences, such as altruism, play a key role in the choice of social interactions, which in turn affect the diffusion of a pandemic. We build a dynamic epidemiological model with endogenous social interactions in a frictional environment, also in a variant with heterogeneous agents and a network structure. Taking into account agents’ endogenous behavior and altruism generates markedly different predictions relative to a naïve epidemiological model with exogenous contact rates. Congestion and commitment inefficiencies arise, even under full altruism, and call for policy intervention. We derive the efficient allocation, and show how the Ramsey planner can mitigate the respective externalities.

Keywords: Social interactions; Pandemics; SIR models; Social preferences; Targeted policies (search for similar items in EconPapers)
JEL-codes: D62 D64 D85 D91 E70 I10 I18 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Altruism, Social Interactions, and the Course of a Pandemic (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:161:y:2024:i:c:s0014292123002532

DOI: 10.1016/j.euroecorev.2023.104625

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