Unlocking

The ideal case would come if we could confirm the virus had been wiped out completely in Australia (or in a particular state). Then, provided all new arrivals were subject to strict quarantine, we could drop all the restrictions except those that made sense for other reasons (encouraging/requiring hand washing is an obvious example[1]).

But that’s unlikely to happen soon. In the absence of comprehensive testing, even if measures of new cases fall to zero, it’s hard to be sure that there aren’t any undetected cases. And it will be some time before new cases reach zero.

So, we need to consider which restrictions we should lift, subject to the constraint that R is still below one, meaning that any undetected outbreaks will ultimately fizzle out. This is a question which will need collaboration between epidemiologists, economists, and other social scientists.

(As an aside, although there has been some conflict between economists and epidemologists it isn’t, as has been suggested, that economists have resisted lockdown measures that might damage “the economy”. On the contrary, with few exceptions economists were pushing for a more rapid lockdown, based on considerations of option value (see below). Rather, the issue has mostly been a sadly familiar one of disciplinary turf wars.)

The problem is essentially one of benefit cost analysis: which measures can be relaxed at least cost in terms of increased R relative to the benefits that relaxation will generate. The epidemiologists have the expertise to answer the first question (as well as can be done in the light of very limited evidence), economists and social scientists the second.

The other key issue, which I’ve mentioned before, is that of option value. If a decision is easily reversed, at relatively low cost, it has an option value relative to a decision that is effectively irreversible. That’s why it made sense to lock down early, rather than waiting to see if the virus spread.

Without treading too much on the epidemiologists turf, it seems pretty clear that the worst risks of spreading the disease come when large numbers of unrelated people are together in close proximity for a long time (cruise ships being the worst case, but sporting matches and cinemas fit the bill to a lesser degree).

Now playing sociologist, I’ll assert that some of the most burdensome restrictions are those that prevent gatherings involving modest numbers of family and close friends. Given the big benefits from relaxing these restrictions and the low cost (in terms of R) in terms of doing so, these seem like obvious candidates for consideration.

Turning to economic activity, the costs of restricting an activity involving personal contact depend critically on the availability of remote-delivery substitutes. Most obviously, office work of all kinds can be done remotely. Costs associated with lower efficiency and more goofing off are offset by the reduction in commuting costs. It’s entirely possible that the benefit to workers who place a high weight on commuting costs outweighs the cost to bosses who find supervision more difficult (and colleagues who enjoy social contact at work). Conversely, as has been pointed out with a good deal of derision, there is no way of doing a haircut from 1.5 metres away. That wasn’t a good reason for excluding them from the lockdown (haircuts can easily be deferred after all) but it makes them a good candidate for subsequent relaxation.

School closures provide an example where option values are relevant. If we reopen the schools it will be costly to close them again (a slightly garbled version of this reasoning explains the government’s reluctance to close them in the first place). So, before reopening schools, we need to make sure that all the necessary facilities for handwashing and other health measures are in place, and that there is enough testing to detect infections before they spread.

How soon will this be relevant? I don’t know, but the one thing I’ve learned in this pandemic is that everything happens much faster than you think it will, even after you’ve tried to adjust for the fact that everything happens much faster than you think it will.

A final point on which I hope to expand more. Apart from lockdowns, the one thing that has been shown to work well is testing, lots and lots of testing. Communication on this point has been terrible, but it appears that we are still subject to constraints on the availability of tests and of labs to process them. Relaxing those constraints and extending testing to include everyone with Covid-like symptoms and sampling of people with no apparent symptoms or contacts, needs to be done ASAP.