Polarized Public Responses to Pandemic: A Homo Economicus’Point of View
Date: Wednesday, Oct 20, 2021, 14:30 ~ 16:00
Speaker: Audrey Xianhua Hu (City University of Hong Kong)
Location: Zoom을 통한 온라인세미나
Abstract: We present a model of dynamic game under pandemic risk in which a continuum of agents, each endowed with a private or imperfectly observable (multidimensional) type, choose communicable activities at ∈ [0, 1] in each period t = 1, 2,… as long as they are active and drop out of the game as soon as they show symptoms of the disease. A higher level of at increases an agent’s current period utility but also increases his probability of infection.
The model involves stochastic transmission rates, asymptomatically infected agents, and a general matching function that determines how individuals’ communicable activities mutually affect each others’ infection probability. Agents can acquire immunity unknowingly when they are asymptomatically infected in the past. This possibility implies each active agent has a path-dependent disease probability, which significantly complicates the analysis. Nevertheless, a sequential public-response equilibrium, akin to perfect Bayesian equilibrium in this context, can be characterized for the matching function exhibiting either concavity or convexity. Polarized public responses arise from the common assumption of a concave matching function, i.e., in every period, active agents choose either at = 0 (safety-first) or at = 1 (life-as-usual) or randomize between the two opposite choices. Our comparative statics analysis suggests that agents who are prone to getting sick and suffering more once infected tend to choose low communicable activities. The free-riding problem prevents all agents from choosing 0 in any period even when it is socially optimal to do so.
Keywords: Stochastic dynamic programming; pandemic risk; matching function; asymptomatic infection; polarized public response
* 본 세미나는 VEAEBES(Virtual East Asia Experimental and Behavioral Economics Seminar series) 주최로 열리는 세미나입니다.
참여신청은 아래의 링크로 해주시길 바랍니다.
link
이후 이메일로 zoom링크가 발송됩니다.
The model involves stochastic transmission rates, asymptomatically infected agents, and a general matching function that determines how individuals’ communicable activities mutually affect each others’ infection probability. Agents can acquire immunity unknowingly when they are asymptomatically infected in the past. This possibility implies each active agent has a path-dependent disease probability, which significantly complicates the analysis. Nevertheless, a sequential public-response equilibrium, akin to perfect Bayesian equilibrium in this context, can be characterized for the matching function exhibiting either concavity or convexity. Polarized public responses arise from the common assumption of a concave matching function, i.e., in every period, active agents choose either at = 0 (safety-first) or at = 1 (life-as-usual) or randomize between the two opposite choices. Our comparative statics analysis suggests that agents who are prone to getting sick and suffering more once infected tend to choose low communicable activities. The free-riding problem prevents all agents from choosing 0 in any period even when it is socially optimal to do so.
Keywords: Stochastic dynamic programming; pandemic risk; matching function; asymptomatic infection; polarized public response
* 본 세미나는 VEAEBES(Virtual East Asia Experimental and Behavioral Economics Seminar series) 주최로 열리는 세미나입니다.
참여신청은 아래의 링크로 해주시길 바랍니다.
link
이후 이메일로 zoom링크가 발송됩니다.