The Optimal Control of Infectious Diseases Via Prevention and Treatment

75 Pages Posted: 4 Apr 2012

See all articles by Bob (R. E.) Rowthorn

Bob (R. E.) Rowthorn

University of Cambridge - Faculty of Economics

Flavio Toxvaerd

University of Cambridge - Faculty of Economics

Date Written: April 2012

Abstract

This paper fully characterizes the optimal control of a recurrent infectious disease through the use of (non-vaccine) prevention and treatment. The dynamic system may admit multiple steady states and the optimal policy may be path dependent. We find that an optimal path cannot end at a point with maximal prevention; it is necessarily zero or at an intermediate level. In contrast, an optimal path must end at a point at which treatment is either maximal or minimal. We find that the comparative statics of the model may radically differ across steady states, which has important policy implications. Last, we consider the model with decentralized decision making and compare the equilibrium outcomes with the socially optimal outcomes. We find that steady state prevalence levels in decentralized equilibrium must be equal to or higher than the socially optimal levels. While steady state treatment levels under decentralization are typically socially optimal, steady state prevention (if used) is socially suboptimal.

Keywords: Economic epidemiology, Hysteresis, Non-convex systems, Optimal and equilibrium policy mix, Treatment and prevention

JEL Classification: C73, I18

Suggested Citation

Rowthorn, Bob (R. E.) and Toxvaerd, Flavio, The Optimal Control of Infectious Diseases Via Prevention and Treatment (April 2012). CEPR Discussion Paper No. DP8925, Available at SSRN: https://ssrn.com/abstract=2034143

Bob (R. E.) Rowthorn (Contact Author)

University of Cambridge - Faculty of Economics ( email )

Sidgwick Avenue
Cambridge, CB3 9DE
United Kingdom

Flavio Toxvaerd

University of Cambridge - Faculty of Economics ( email )

Austin Robinson Building
Sidgwick Avenue
Cambridge, CB3 9DD
United Kingdom

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