Optimal Targeted Lockdowns in a Multi-Group Sir Model

57 Pages Posted: 5 May 2020

See all articles by Daron Acemoglu

Daron Acemoglu

Massachusetts Institute of Technology (MIT) - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Victor Chernozhukov

Massachusetts Institute of Technology (MIT)

Iván Werning

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER)

Michael D. Whinston

Sloan School of Management and Department of Economics

Date Written: May 2020

Abstract

We study targeted lockdowns in a multi-group SIR model where infection, hospitalization and fatality rates vary between groups—in particular between the “young”, “the middle-aged” and the “old”. Our model enables a tractable quantitative analysis of optimal policy. For baseline parameter values for the COVID-19 pandemic applied to the US, we find that optimal policies differentially targeting risk/age groups significantly outperform optimal uniform policies and most of the gains can be realized by having stricter lockdown policies on the oldest group. Intuitively, a strict and long lockdown for the most vulnerable group both reduces infections and enables less strict lockdowns for the lower-risk groups. We also study the impacts of group distancing, testing and contract tracing, the matching technology and the expected arrival time of a vaccine on optimal policies. Overall, targeted policies that are combined with measures that reduce interactions between groups and increase testing and isolation of the infected can minimize both economic losses and deaths in our model.

Suggested Citation

Acemoglu, Daron and Chernozhukov, Victor and Werning, Ivan and Whinston, Michael D., Optimal Targeted Lockdowns in a Multi-Group Sir Model (May 2020). NBER Working Paper No. w27102, Available at SSRN: https://ssrn.com/abstract=3592179

Daron Acemoglu (Contact Author)

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Victor Chernozhukov

Massachusetts Institute of Technology (MIT) ( email )

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Ivan Werning

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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Michael D. Whinston

Sloan School of Management and Department of Economics ( email )

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