Individual Preferences, Government Policy, and COVID-19: A Game-theoretic Epidemiological Analysis

Purpose: The ongoing COVID-19 pandemic imposes serious short-term and long-term health costs on populations. Restrictive government policy measures decrease the risks of infection, but produce similarly serious social, mental health, and economic problems. Citizens have varying preferences about the desirability of restrictive policies, and governments are thus forced to navigate this tension in making pandemic policy. This paper analyses the situation facing government using a game-theoretic epidemiological model.

Methodology: We classify individuals into health-centered individuals and freedom-centered individuals to capture the heterogeneous preferences of citizens. We first use the extended Susceptible-Exposed-Asymptomatic-Infectious-Recovered (SEAIR) model (adding individual preferences) and the signaling game model (adding government) to analyze the strategic situation against the backdrop of a realistic model of COVID-19 infection.

Findings: We find the following: 1. There exists two pooling equilibria. When health-centered and freedom-centered individuals send anti-epidemic signals, the government will adopt strict restrictive policies under budget surplus or balance. When health-centered and freedom-centered individuals send freedom signals, the government chooses not to implement restrictive policies. 2. When governments choose not to impose restrictions, the extinction of an epidemic depends on whether it has a high infection transmission rate; when the government chooses to implement non-pharmacological interventions (NPIs), whether an epidemic will disappear depends on how strict the government's restrictions are.

Originality/value: Based on the existing literature, we add individual preferences and put the government into the game as a player. Our research extends the current form of combining epidemiology and game theory. By using both we get a more realistic understanding of the spread of the virus and combine that with a richer understanding of the strategic social dynamics enabled by game theoretic analysis. Our findings have important implications for public management and government decision-making in the context of COVID-19 and for potential future public health emergencies.