Pandemic Control in Econ-Epi Networks

47 Pages Posted: 31 Aug 2020 Last revised: 17 Jul 2021

See all articles by Marina Azzimonti

Marina Azzimonti

SUNY Stony Brook - Department of Economics; National Bureau of Economic Research (NBER)

Alessandra Fogli

Federal Reserve Bank of Minneapolis

Fabrizio Perri

Federal Reserve Banks - Federal Reserve Bank of Minneapolis

Mark Ponder

affiliation not provided to SSRN

Multiple version iconThere are 2 versions of this paper

Date Written: August 2020

Abstract

We develop an ECON-EPI network model to evaluate policies designed to improve health and economic outcomes during a pandemic. Relative to the standard epidemiological SIR set-up, we explicitly model social contacts among individuals and allow for heterogeneity in their number and stability. In addition, we embed the network in a structural economic model describing how contacts generate economic activity. We calibrate it to the New York metro area during the 2020 COVID-19 crisis and show three main results. First, the ECON-EPI network implies patterns of infections that better match the data compared to the standard SIR. The switching during the early phase of the pandemic from unstable to stable contacts is crucial for this result. Second, the model suggests the design of smart policies that reduce infections and at the same time boost economic activity. Third, the model shows that reopening sectors characterized by numerous and unstable contacts (such as large events or schools) too early leads to fast growth of infections.

Suggested Citation

Azzimonti, Marina and Fogli, Alessandra and Perri, Fabrizio and Ponder, Mark, Pandemic Control in Econ-Epi Networks (August 2020). NBER Working Paper No. w27741, Available at SSRN: https://ssrn.com/abstract=3683617

Marina Azzimonti (Contact Author)

SUNY Stony Brook - Department of Economics ( email )

NY 11733-4384
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Alessandra Fogli

Federal Reserve Bank of Minneapolis ( email )

90 Hennepin Avenue
Minneapolis, MN 55480
United States

Fabrizio Perri

Federal Reserve Banks - Federal Reserve Bank of Minneapolis ( email )

90 Hennepin Avenue
Minneapolis, MN 55480
United States

Mark Ponder

affiliation not provided to SSRN

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