Political Economy of Shelter-in-Place Compliance

44 Pages Posted: 19 May 2020

See all articles by Arda Gitmez

Arda Gitmez

University of Chicago - Harris School of Public Policy

Konstantin Sonin

University of Chicago - Harris School of Public Policy; Higher School of Economics; Centre for Economic Policy Research (CEPR)

Austin L. Wright

University of Chicago - Harris School of Public Policy

Date Written: May 18, 2020

Abstract

We propose a model in which agents with heterogeneous incomes decide whether to comply with shelter-in-place orders or gain additional income at the risk of getting the disease. There is a negative externality of non-compliance as the risk of catching COVID-19 is a function of the number of non-compliers. Drawing on evidence collected during the first months of the 2020 pandemic, we show theoretically that the level of compliance is higher in richer communities, and the effect of inequality on compliance is non-monotonic in the severity of pandemic. Slanted media affect compliance as well: if the media de-emphasizes the threat, compliance falls. At the same time, the demand for such media is higher among those who are less likely to comply.

Keywords: COVID-19, shelter-in-place, compliance, media slant, income inequality

JEL Classification: D72, L82, H12, I18

Suggested Citation

Gitmez, Arda and Sonin, Konstantin and Wright, Austin L., Political Economy of Shelter-in-Place Compliance (May 18, 2020). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2020-68. Available at SSRN: https://ssrn.com/abstract=3604320

Arda Gitmez

University of Chicago - Harris School of Public Policy ( email )

1155 East 60th Street
Chicago, IL 60637
United States

Konstantin Sonin (Contact Author)

University of Chicago - Harris School of Public Policy ( email )

1155 East 60th Street
Chicago, IL 60637
United States

Higher School of Economics ( email )

20 Myasnitskaya street
Moscow, 119017
Russia

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Austin L. Wright

University of Chicago - Harris School of Public Policy ( email )

1155 East 60th Street
Chicago, IL 60637
United States

HOME PAGE: http://www.austinlwright.com

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