On the Optimal Lockdown During an Epidemic

Martin Gonzalez-Eiras and Dirk Niepelt

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft

Abstract: We embed a lockdown choice in a simplified epidemiological model and derive formulas for the optimal lockdown intensity and duration. The optimal policy re- ects the rate of time preference, epidemiological factors, the hazard rate of vaccine discovery, learning effects in the health care sector, and the severity of output losses due to a lockdown. In our baseline specification a Covid-19 shock as currently expe- rienced by the US optimally triggers a reduction in economic activity by two thirds, for about 50 days, or approximately 9:5 percent of annual GDP.

Keywords: Epidemic; pandemic; lockdown; social distancing; production shortfall; health care system; Covid-19; SIR model; logistic model (search for similar items in EconPapers)
JEL-codes: I18 (search for similar items in EconPapers)
Date: 2020-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

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Related works:
Working Paper: On the Optimal "Lockdown" during an Epidemic (2020)
Working Paper: On the Optimal "Lockdown" During an Epidemic (2020)
Working Paper: On the Optimal "Lockdown" During an Epidemic (2020)
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