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Optimal Testing and Social Distancing of Individuals With Private Health Signals

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  • Thomas Tröger

Abstract

We consider individuals who are privately informed about the probability of being infected by a potentially dangerous disease. Depending on its private health signal, an individual may assign a positive or negative value to getting tested for the disease. Individuals dislike social distancing. The government has scarce testing capacities and scarce resources for enforcing social-distance keeping. We solve the government's problem of setting up an optimal testing-and-social-distancing schedule, taking into account that individuals may lie about their private health signal. Rather than modelling the infection dynamics, we take a snapshot view, that is, we ask what should be done at a particular point in time to curb the current spread of the disease while taking the current well-being of the individuals into account as well. If testing capacities are sufficiently scarce, then it can be optimal to test only a randomly selected fraction of those who want to be tested, and require maximal social distancing precisely for those individuals who wanted a test and ended up not belonging to the tested fraction.

Suggested Citation

  • Thomas Tröger, 2020. "Optimal Testing and Social Distancing of Individuals With Private Health Signals," CRC TR 224 Discussion Paper Series crctr224_2020_229, University of Bonn and University of Mannheim, Germany.
    • Handle: RePEc:bon:boncrc:crctr224_2020_229
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    File URL: https://www.crctr224.de/research/discussion-papers/archive/dp229
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    Cited by:

    1. David Turner & Balázs Égert & Yvan Guillemette & Jarmila Botev, 2021. "The tortoise and the hare: The race between vaccine rollout and new COVID variants," OECD Economics Department Working Papers 1672, OECD Publishing.

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