Assessing Targeted Containment Policies to Fight COVID-19

Francesco Grigoli () and Jose Manuel Mota Aquino ()

No 2020/277, IMF Working Papers from International Monetary Fund

Abstract: The large economic costs of full-blown lockdowns in response to COVID-19 outbreaks, coupled with heterogeneous mortality rates across age groups, led to question non-discriminatory containment measures. In this paper we provide an assessment of the targeted approach to containment. We propose a SIR-macro model that allows for heterogeneous agents in terms of mortality rates and contact rates, and in which the government optimally bans people from working. We find that under a targeted policy, the optimal containment reaches a larger portion of the population than under a blanket policy and is held in place for longer. Compared to a blanket policy, a targeted approach results in a smaller death count. Yet, it is not a panacea: the recession is larger under such approach as the containment policy applies to a larger fraction of people, remains in place for longer, and herd immunity is achieved later. Moreover, we find that increased interactions between low- and high-risk individuals effectively reduce the benefits of a targeted approach to containment.

Keywords: Optimal containment policies; COVID-19; heterogeneous agents; recession; voluntary social distancing.; WP; policy scenario; containment policy; share of contact; blanket policy scenario; optimal containment; targeted policy approach (search for similar items in EconPapers)
Pages: 31
Date: 2020-12-11
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Related works:
Journal Article: Assessing Targeted Containment Policies to Fight COVID-19 (2022)
Working Paper: Assessing Targeted Containment Policies to Fight COVID-19 (2021)
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