Discussion Paper

Measuring and Managing COVID-19 Model Risk

Abstract: One of the many lessons learned from the financial crisis is the increased awareness of model risk. In this article, I apply the best practices of model risk management found in SR 11-7 (which offers regulatory guidance on the best practices for managing model risk) to COVID-19 models. In particular, I investigate the Institute of Health Metrics and Evaluation's (IHME) model to see if it has been effectively challenged with a critical assessment of its conceptual soundness, ongoing monitoring, and outcomes analysis.

Keywords: COVID-19; model risk management; SR 11-7;

JEL Classification: C1; C11; C52;

https://doi.org/10.29338/ph2020-07

Bibliographic Information

Provider: Federal Reserve Bank of Atlanta

Part of Series: Policy Hub*

Publication Date: 2020-06-18

Number: 2020-07