On the Optimal "Lockdown" during an Epidemic

Arbeitspapier

We embed a lockdown choice in a simplified epidemiological model and derive formulas for the optimal lockdown intensity and duration. The optimal policy reflects 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 experienced 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.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 8240

Classification and Topics

• Classification: Wirtschaft ; Health: Government Policy; Regulation; Public Health
• Subject: epidemic ; pandemic ; lockdown ; social distancing ; production shortfall ; health care system ; Covid-19 ; SIR model ; logistic model

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Gonzalez-Eiras, Martín ; Niepelt, Dirk
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/216636
• Last update: 10.03.2025, 11:45 AM CET