Epidemic Responses Under Uncertainty
We examine how policymakers react to a pandemic with uncertainty around key epidemiological and economic policy parameters by embedding a macroeconomic SIR model in a robust control framework. Uncertainty about disease virulence and severity leads to stricter and more persistent quarantines, while uncertainty about the economic costs of mitigation leads to less stringent quarantines. On net, an uncertainty averse planner adopts stronger mitigation measures. Intuitively, the cost of underestimating the pandemic is out-of-control growth and permanent loss-of-life, while the cost of underestimating the economic consequences of quarantine is more transitory.
Michael Barnett & Greg Buchak & Constantine Yannelis, 2023. "Epidemic responses under uncertainty," Proceedings of the National Academy of Sciences, vol 120(2). citation courtesy of