A Theory of Voluntary Testing and Self-isolation in an Ongoing Pandemic
Thinking beyond Covid-19, there is a growing interest in what economic structures will be needed to face ongoing pandemics. In this paper we focus on the diagnostic problem and examine a new paradigm of voluntary self-testing by private individuals. People without symptoms face daily choices of either taking the risk of going out (to work and socialize), versus staying at home in self-isolation. Our theory shows that two types of people voluntary test themselves: those who otherwise would have self-isolated, and those who would have gone out indiscriminately. Our central insight is that the equilibrium infection risk falls when home-based testing becomes cheaper and easier to use, even if tests are not always accurate. Our results challenge the clinical mainstream view that diagnostic testing is a prerogative of the medical profession, and supports the notion that frequent self-testing is vital for an economy facing an ongoing pandemic.
I thank the Said Business School for its research support. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Thomas Hellmann & Veikko Thiele, 2022. "A theory of voluntary testing and self‐isolation in an ongoing pandemic," Journal of Public Economic Theory, vol 24(5), pages 873-911. citation courtesy of