Working Paper: CEPR ID: DP17952
Authors: Alexander M. Dietrich; Wilhelm Kohler; Gernot J. Müller
Abstract: Against the backdrop of Covid-19, we study the effectiveness of public policies typically employed to fight an epidemic. We extend the compartmental SIR model to explore the trade-offs which govern individual behavior. Our stylized model allows for a closed form analysis of vaccination and lockdown policies. We establish Peltzman effects: As policies lower the risk of infections, people become more socially active, which---in turn---undermines their effectiveness. We detect patterns in data for both, US states and countries in Western Europe which are consistent with the notion that such effects are shaping actual infection dynamics to a considerable extent.
Keywords: COVID-19; Pandemic; Behavioral Adjustment; SIR Model; Risk Compensation; Lockdowns; Vaccinations
JEL Codes: I12; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Vaccination lowers the risk of infection and death but increases social activity (I14) | potentially more infections and deaths (I12) |
| Lockdown policies lower the risk of infections but may also lead to increased social activity among less vulnerable individuals (H31) | potentially raising the case fatality rate (I12) |
| Vaccination rates are not strongly correlated with current infections and deaths (I14) | behavioral adjustments largely offset the direct impact of vaccinations (E71) |
| Lockdown stringency negatively relates to mortality (I12) | positively relates to case fatality rates (I12) |