Our Three-step Plan for Ending Economy’s Virus Hibernation

A lockdown is necessary to limit the spread of the virus and save lives, but it is not feasible or practical to prolong it for too long. A long lockdown will wipe out large swathes of the economy. There will be a negative impact both financially and mentally on too many people.

It is important to make plans now for when and why the lockdown will end. There are significant trade-offs in these key decisions. In a new research paper we have outlined how to end the lockdown in a phased and gradual way.

The mathematical models of epidemiology currently occupy centre-stage in policymaking. To be absolutely clear, these models have real scientific value and have had a positive impact on policy making, justifying the lockdown.

Using the analytical framework of epidemiological models and the key behavioural insights from economics it is possible to outline a credible exit strategy.

If people revert very quickly to the patterns of behaviour of before the crisis, the epidemiological models are correct. There would be a second wave of infections.

But behaviour will be different, either because of the lessons people have learned during this crisis, or because of the constraints placed upon them by rules and regulations. How many people will shake hands the day after the lockdown is lifted?

Incentives matter. This is a key point that comes to the fore in economics. It may be overlooked if we rely purely on the arguments of epidemiologists to prolong the lockdown.

We suggest that lockdown is followed by three phases, as in a traffic light, from red to amber to green. Then everyone is clear about the sense of direction and it also gives hope.

The first phase would deliberately be called red, where we must still stop doing things we might have done before the crisis. More but not all types of shops could open and they would have to exercise strict social distancing, as most supermarkets do now. Travel should still be discouraged and many international flights banned.

Then to amber, as conditions improved, but we still need to be careful. Unlimited private car journeys should be allowed but not to crowded places. There would have to be attempts to vary the rush-hour, with different opening and closing times. Wearing masks and disposable gloves could be compulsory when using public transport. Restaurants could reopen but uphold social distancing.

Eventually, back to green, when medical experts can give the all-clear. It would only be in the green phase that any sporting events or mass gatherings could take place, or places of worship reopen. It is in large gatherings that a single person may infect many. Mass transit could return to normal.

The lockdown is helping overcome the health risk the country faces. However, only by ending the lockdown can we bring the economy out of hibernation and back to life.

Co-authored with Paul Ormerod, a visiting professor of Computer Science at University College, London.

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