Paying for the right to be infected
August 14, 2020 in covid-19, economics, infection, Mechanism design
Serious infectious diseases are a prime example of a public bad (non-exclusive and non-congestible). We limit them by restricting behavior and or getting individuals to internalize the externalities they generate. For example, one could mandate masks in public places. To be effective this requires monitoring and punishment. Unpleasant, but we know how to do this. Or, one could hold those who don’t wear masks responsible for the costs they impose on those whom they infect. Unclear exactly how we would implement this, so impractical. However, it is still interesting to speculate about how one might do this. Coase pointed out that if one could tie the offending behavior to
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