The Economic Consequences of R < 1: Towards a Workable Behavioural Epidemiological Model of Pandemics

Working Paper: NBER ID: w27632

Authors: Joshua S. Gans

Abstract: This paper reviews the literature on incorporating behavioural elements into epidemiological models of pandemics. While modelling behaviour by forward-looking rational agents can provide some insight into the time paths of pandemics, the non-stationary nature of Susceptible-Infected-Removed (SIR) models of viral spread makes characterisation of resulting equilibria difficult. Here I posit a shortcut that can be deployed to allow for a tractable equilibrium model of pandemics with intuitive comparative statics and also a clear prediction that effective reproduction numbers (that is, R) will tend towards 1 in equilibrium. This motivates taking R̂=1 as an equilibrium starting point for analyses of pandemics with behavioural agents. The implications of this for the analysis of widespread testing, tracing, isolation and mask-use is discussed.

Keywords: Behavioral Epidemiology; Pandemics; Effective Reproduction Number

JEL Codes: I12; I18


Causal Claims Network Graph

Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.


Causal Claims

CauseEffect
Behavioral adjustments (D91)Effective reproduction number (R) tends towards 1 (C59)
Perception of infected individuals (I12)Behavioral adjustments (D91)
Effective reproduction number (R) tends towards 1 (C59)Dynamics of infection spread (C69)
Basic reproduction number (R0) increases (C59)Activity of susceptible individuals decreases (I12)
Activity of susceptible individuals decreases (I12)Overall infection rates impact (I14)

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