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Quarantine Economics: Is Lockdown Effective and How Much Does It Cost

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The paper presents a model of city stricken by epidemic. We count for-purpose and by-chance meetings happening to its citizens and derive formal relations of economic and epidemiological states of the city during quarantine. Theoretical factorization of disease reproduction number allows us to classify possible protective measures and evaluate their relative effectiveness in mitigating the epidemic. Lockdown and remote work turn out to be most effective. In the final part of the paper we study economic consequences of quarantine and partially disprove the health-wealth trade-off. We show that severity of lockdown affects duration, but not the time-averaged depth of the crisis. Link to the full version: https://drive.google.com/file/d/1lKCSMWJ_Ur4Cj7VhLsBsmsSkV-vOe9xX/view?usp=sharing Discussion post in Russian: http://andrewvorchik.com/3277
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Quarantine Economics:
Is Lockdown Eective
and How Much Does It Cost
Andrew Vorchik
1
AV
Abstract
The paper presents a model of city stricken by epidemic. We count for-purpose
and by-chance meetings happening to its citizens and derive formal relations of
economic and epidemiological states of the city during quarantine. Theoreti-
cal factorization of disease reproduction number allows us to classify possible
protective measures and evaluate their relative eectiveness in mitigating the
epidemic. Lockdown and remote work turn out to be most eective. In the nal
part of the paper we study economic consequences of quarantine and partially
disprove the health-wealth trade-o. We show that severity of lockdown aects
duration, but not the time-averaged depth of the crisis.
AV
Keywords: COVID-19, eective reproduction number,
lockdown, coronacrisis, health-wealth trade-o.
JEL: I180.
Moscow and
Σ𝜅´𝛼𝜆𝛼 Φ𝑜´𝜐𝜌𝜅𝛼𝜍.
October 2021. For the latest version click here.
1
ICEF, HSE University. Moscow, Russia. Email:
vorchik.a@gmail.com
. Website:
AndrewVorchik.com
.
The author is grateful to professor Roman Zakharenko for valuable advice.
1Андрей Ворчик
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