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Profits, Pandemics, and Lockdown Effectiveness in Nursing Home Networks

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  • Pongou, Roland
  • Sidie, Ghislain Junior
  • Tchuente, Guy
  • Tondji, Jean-Baptiste

Abstract

How do pandemics affect for-profit and not-for-profit organizations differently? To address this question, we analyse optimal lockdowns in a two-sector continuous-time individual-based mean-field epidemiological model. We uncover a unique solution that depends on network structure, lockdown effectiveness, and the planner's tolerable infection incidence. Using unique data on nursing home networks in the United States, we calibrate the model and jointly quantify state-level lockdown effectiveness and preference for enforcing stringent containment strategies during the COVID-19 pandemic. We also empirically validate simulation results derived from the theoretical analyses. We find that for-profit nursing homes experience higher COVID-19 death rates than not-for-profit nursing homes. In addition, this differential health effect increases with lockdown effectiveness.

Suggested Citation

  • Pongou, Roland & Sidie, Ghislain Junior & Tchuente, Guy & Tondji, Jean-Baptiste, 2022. "Profits, Pandemics, and Lockdown Effectiveness in Nursing Home Networks," National Institute of Economic and Social Research (NIESR) Discussion Papers 540, National Institute of Economic and Social Research.
    • Handle: RePEc:nsr:niesrd:540
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    More about this item

    Keywords

    Pandemics; Profits; Social networks; Lockdown effectiveness; Nursing Homes;
    All these keywords.

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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