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Report
Behavior and the Transmission of COVID-19
We show that a simple model of COVID-19 that incorporates feedback from disease prevalence to disease transmission through an endogenous response of human behavior does a remarkable job fitting the main features of the data on the growth rates of daily deaths observed across a large number countries and states of the United States from March to November of 2020. This finding, however, suggests a new empirical puzzle. Using an accounting procedure akin to that used for Business Cycle Accounting as in Chari et al. (2007), we show that when the parameters of the behavioral response of ...
Working Paper
What Happened to the US Economy During the 1918 Influenza Pandemic? A View Through High-Frequency Data
Burns and Mitchell (1946, 109) found a recession of “exceptional brevity and moderate amplitude.” I confirm their judgment by examining a variety of high-frequency data. Industrial output fell sharply but rebounded within months. Retail seemed little affected and there is no evidence of increased business failures or stressed financial system. Cross-sectional data from the coal industry documents the short-lived impact of the epidemic on labor supply. The Armistice possibly prolonged the 1918 recession, short as it was, by injecting momentary uncertainty. Interventions to hinder the ...
Report
A Parsimonious Behavioral SEIR Model of the 2020 COVID Epidemic in the United States and the United Kingdom
I present a behavioral epidemiological model of the evolution of the COVID epidemic in the United States and the United Kingdom over the past 12 months. The model includes the introduction of a new, more contagious variant in the UK in early fall and the US in mid December. The model is behavioral in that activity, and thus transmission, responds endogenously to the daily death rate. I show that with only seasonal variation in the transmission rate and pandemic fatigue modeled as a one-time reduction in the semi-elasticity of the transmission rate to the daily death rate late in the year, the ...
Working Paper
How do Doctors Respond to Incentives? Unintended Consequences of Paying Doctors to Reduce Costs
Billions of dollars have been spent on pilot programs searching for ways to reduce healthcare costs. I study one such program, where hospitals pay doctors bonuses for reducing the total hospital costs of admitted Medicare patients (a ?bundled payment?). Doctors respond to the bonuses by becoming more likely to admit patients whose treatment can generate high bonuses, and sorting healthier patients into participating hospitals. Conditional on patient health, however, doctors do not reduce costs or change procedure use. These results highlight the ability of doctors to game incentive schemes, ...
Working Paper
Pandemic Recessions and Contact Tracing
We study contact tracing in a new macro-epidemiological model in which infected agents may not show any symptoms of the disease and the availability of tests to detect these asymptomatic spreaders of the virus is limited. Contact tracing is a testing strategy aiming at reconstructing the infection chain of newly symptomatic agents. A coordination failure arises as agents fail to internalize that their individual consumption and labor decisions raise the number of traceable contacts to be tested, threatening the viability of the tracing system. The collapse of the tracing system considerably ...
Working Paper
The Impact of Tobacco-Free School Laws on Student and Staff Smoking Behavior
A number of US states have enacted bans on tobacco use by students, staff, and visitors anywhere on the grounds of public elementary and secondary schools statewide. These laws are intended to reduce tobacco use, reduce exposure to secondhand smoke, reinforce anti-tobacco curricula taught in schools, and prevent children from viewing their teachers and fellow students using tobacco products. We examine the impact that the laws have on the smoking behavior of students, teachers, and other school staff by estimating difference-in-differences models that exploit the time variation in adoption of ...
Working Paper
Racial Disparities in Frontline Workers and Housing Crowding during COVID-19: Evidence from Geolocation Data
We document that racial disparities in COVID-19 in New York City stem from patterns of commuting and housing crowding. During the initial wave of the pandemic, we find that out-of-home activity related to commuting is strongly associated with COVID-19 cases at the ZIP Code level and hospitalization at an individual level. After layoffs of essential workers decreased commuting, we find case growth continued through household crowding. A larger share of individuals in crowded housing or commuting to essential work are Black, Hispanic, and lower-income. As a result, structural inequalities, ...
Working Paper
The Dynamics of the Smoking Wage Penalty
Cigarette smokers earn significantly less than nonsmokers, but the magnitude of the smoking wage gap and the pathways by which it originates are unclear. Proposed mechanisms often focus on spot differences in employee productivity or employer preferences, neglecting the dynamic nature of human capital development and addiction. In this paper, we formulate a dynamic model of young workers as they transition from schooling to the labor market, a period in which the lifetime trajectory of wages is being developed. We estimate the model with data from the National Longitudinal Survey of Youth, ...
Working Paper
The Evolution of Health over the Life Cycle
We construct a unified objective measure of health status: the frailty index, defined as the cumulative sum of all adverse health indicators observed for an individual. First, we show that the frailty index has several advantages over self-reported health status, particularly when studying health dynamics. Then we estimate a stochastic process for frailty dynamics over the life cycle. We find that the autocovariance structure of frailty in panel data strongly supports a process that allows the conditional variance of frailty shocks to increase with age. Our frailty measure and dynamic process ...
Working Paper
Modern Pandemics: Recession and Recovery
We examine the immediate effects and bounce-back from six modern health crises: 1968 Flu, SARS (2003), H1N1 (2009), MERS (2012), Ebola (2014), and Zika (2016). Time-series models for a large cross-section of countries indicate that real GDP growth falls by around three percentage points in affected countries relative to unaffected countries in the year of the outbreak. Bounce-back in GDP growth is rapid, but output is still below pre-shock level five years later. Unemployment for less educated workers is higher and exhibits more persistence, and there is significantly greater persistence in ...