UCL Department of Economics


New CeMMAP working paper with results on optimal lockdown strategies

5 May 2020

from cemmap international fellow, Victor Chernozhukov, and MIT coauthors, Acemoglu, Werning and Whinston

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The just published research paper develops a new model of COVID-19 infection, survival and economic costs in which lockdown is targeted differentialy across 3 age groups, the old (65+), the young (20-49) and the middle aged.

Optimal targeted lockdown policies are calculated taking account of the economic costs caused by reduced economic activity, lost output from those who succumb, and the non-economic cost placed on lost lives.

A major finding is that a semi-targeted policy in which the lockdown on only the 65+ age group is strict delivers substantially lower economic costs and fewer deaths than many policies in which lockdown applies uniformly across all ages. Additional differential targeting of lockdown amongst those aged 20-64 brings little extra benefit.

Due to paucity of available data there is great uncertainty concerning key parameters which determine the predictions of the model so the calculations are mainly illustrative at this point. However, the dominance of optimally targeted lockdown policies over policies that lockdown uniformly across the entire population is robust to considerable variation in parameter values.

The paper also considers the effect of social distancing, differences in interactions among and across age groups, the expected arrival time of a vaccine, and testing with or without tracing.

Variations in predictions caused by varying values of key parameters can be seen at https://mr-sir.herokuapp.com/ .

The paper is “A Multi-Risk SIR Model of Optimally Targetted Lockdown” by MIT authors Daron Acemoglu, Victor Chernozhukov, Iván Werning and Michael D Whinston and is available on the CeMMAP website.

The Centre for Microdata Methods and Practice (CeMMAP) is an ESRC Research Centre, a joint venture of University College London and the Institute for Fiscal Studies.