Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/223527 
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper No. 8455
Publisher: 
Center for Economic Studies and Ifo Institute (CESifo), Munich
Abstract: 
Countries worldwide have implemented lockdown measures to contain the covid-19 pandemic. After more than three months of restrictions to economic activities in many countries, the question has turned to the best ways to lift lockdowns while keeping the epidemic in check. Here I use basic economic principles to shed light on the key tradeoffs. A central message is that there is no “health vs. economics” dichotomy. Rather, some degree of lockdown is typically optimal in crisis like this, balancing its economic costs against its health benefits. Moreover, the optimal lockdown is dynamic, changes over time and eventually becomes more lenient, although the path is not necessarily monotonic.
Subjects: 
pandemic
covid-19
optimal policies
JEL: 
H00
I10
I18
Document Type: 
Working Paper
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