Working Paper: CEPR ID: DP17553
Authors: Flavio Toxvaerd
Abstract: This paper analyzes equilibrium social distancing choices in a model with potentially asymptomatic infection. Since infection only prompts symptoms probabilistically, individuals cannot perfectly infer their health state from the absence of symptoms. Instead, they must form beliefs about their health state based on knowledge of the population frequencies. I show that relative to a benchmark with perfect health state information, asymptomatic infection leads to lower mitigation through four distinct channels, some mechanistic and some that work through beliefs and thus decisions. The model is then applied to ananalysis of individual and mass testing. The value of the former derives from the value of information and it is shown that the latter may influence the course of the epidemic through its influence on aggregate equilibrium behavior. Tests for immunity generally have a higher value of information and aggregate effects than tests for infection.
Keywords: Economic Epidemiology; Social Distancing; Asymptomatic Infection; Fatalism; Diagnostic Testing
JEL Codes: C73; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| asymptomatic infection (I12) | lower social distancing mitigation (I14) |
| severity effect (C32) | lower incentive to mitigate infection (I12) |
| fatalism effect (G41) | decreased perceived susceptibility (I12) |
| force of infection effect (C20) | reduced infection risk for susceptible individuals (I14) |
| asymptomatic infection (I12) | higher cumulative infections (I12) |
| asymptomatic infection (I12) | lower symptomatic infections (I12) |
| asymptomatic infection (I12) | higher overall social welfare (D69) |