Social Interactions in Pandemics: Fear, Altruism, and Reciprocity

54 Pages Posted: 12 May 2020 Last revised: 27 Jun 2021

See all articles by Laura Alfaro

Laura Alfaro

Harvard University

Ester Faia

Goethe University Frankfurt; Centre for Economic Policy Research (CEPR)

Nora Lamersdorf

Goethe University Frankfurt

Farzad Saidi

Boston University - Questrom School of Business; Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: May 2020

Abstract

Social interactions and social preferences play a central role in public health domains. In the face of a pandemic, individuals adjust their behavior, whereas in SIR models infection rates are typically exogenous. City-level data across countries suggest that mobility falls in response to fear, proxied by Google searches. Incorporating experimentally validated measures of social preferences at the regional level, we find that stringency measures matter less when individuals are more patient, altruistic, or exhibit less negative reciprocity. To account for these findings, we extend homogeneous and networked SIR models by endogenizing agents' social-activity intensity and incorporating social preferences. Our quantitative predictions markedly differ from those of the naïve SIR network model. We derive the planner's problem, and show that neglecting agents' endogenous response leads to misguided policy decisions of various non-pharmaceutical interventions. Any further mobility restrictions, beyond agents' restraint, result from aggregate externalities which are curtailed by social preferences.

Suggested Citation

Alfaro, Laura and Faia, Ester and Lamersdorf, Nora and Saidi, Farzad, Social Interactions in Pandemics: Fear, Altruism, and Reciprocity (May 2020). NBER Working Paper No. w27134, Available at SSRN: https://ssrn.com/abstract=3597866

Laura Alfaro (Contact Author)

Harvard University ( email )

Cambridge, MA 02138
United States

Ester Faia

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Nora Lamersdorf

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

Farzad Saidi

Boston University - Questrom School of Business ( email )

595 Commonwealth Avenue
Boston, MA MA 02215
United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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