Joshua Gans has supplied teachers of economics 101 with a useful case study of the kind that can be productive fodder for current and future students. His new book, written in response to the Covid-19 crisis, focuses on how information flows during a pandemic.
Gans’ central argument is that conceptualizing the coronavirus crisis as a problem of insufficient information is crucial to halt the spread of the disease. If we immediately knew which citizens had contracted the virus, they could be isolated and the threat of an outbreak becoming a pandemic would diminish. It does not follow that a less lethal virus will equate to fewer deaths, because the disease will infect more people before policymakers and public health authorities realize they must take radical action.
The thesis is compelling, and filled with references from outside the world of academia. Already in the first paragraph a clear link is drawn between information and the spread of a virus, which is explained with help of Plague Inc; a video game in which the player must concoct a pathogen to annihilate the human population as swiftly and efficiently as possible.
Concerns over the availability of information to policymakers and citizens reawaken old debates, such as the merits of central planning compared with laissez-faire modes of distribution, when weighing central coordination of a nation’s response to the virus.
This issue is amplified also in the discussion of how to best distribute the vaccine; a question that brings into focus the work of Paul Milgrom and Robert Wilson on auction theory, which received this year’s Nobel prize for economic science.
Our world with imperfect knowledge and incomplete information produces many additional challenges to finding a vaccine. Still, who gets affected – either directly by this virus or from the economic fallout – is left untouched in this book. Instead, the only real issue considered is how to distribute information and convey it so that people act appropriately. No doubt a critical question, but this neglects the socioeconomic realities that are for many, and post-coronavirus will continue to be, the central matter at hand.
THE PANDEMIC INFORMATION GAP is published in paperback by MIT Press, pp. 216, $19.95, November 2020.
André Pedersen Ystehede is a PhD candidate in economics at Leeds University Business School. His research interests include macroeconomics, institutional economics, and agent-based modelling.