The macroeconomics of age-varying epidemics.

ABSTRACT: We incorporate age-specific socio-economic interactions in a SIR macroeconomic model to study the role of demographic factors for the COVID-19 epidemic evolution, its macroeconomic effects and possible containment measures. We capture the endogenous response of rational individuals who choose to reduce inter- and intra-generational social interactions, consumption- and labor-related personal exposure to the virus, while not internalizing the impact of their actions on others. Investigating the effect of different combinations of economic shutdown and social distancing we find that distancing measures targeted to the elderly (who face higher mortality risk and are not part of the labor force) save lives and mitigate output losses. Conversely, the optimal economic shutdown generates small ga

SUBMITTER: Giagheddu M 

PROVIDER: S-EPMC9683863 | biostudies-literature | 2022 Nov

REPOSITORIES: biostudies-literature