DP14658 A Simple Planning Problem for COVID-19 Lockdown
Author(s): | Fernando Alvarez, David Argente, Francesco Lippi |
Publication Date: | April 2020 |
Keyword(s): | Dynamic programming, epidemic control, lockdown, Quarantine |
JEL(s): | C61, I10, I18 |
Programme Areas: | International Macroeconomics and Finance |
Link to this Page: | cepr.org/active/publications/discussion_papers/dp.php?dpno=14658 |
We study the optimal lockdown policy for a planner who controls the fatalities of a pandemic while minimizing the output costs of the lockdown. The policy depends on the fraction of infected and susceptible in the population, prescribing a severe lockdown beginning two weeks after the outbreak, covering 60% of the population after a month, and gradually withdrawing to 20% of the population after 3 months. The intensity of the optimal lockdown depends on the gradient of the fatality rate with respect to the infected, and the availability of antibody testing that yields a welfare gain of 2% of GDP.