This paper offers a parsimonious, rational-choice model to study the effect of pre-existing inequalities on the transmission of COVID-19. Agents decide whether to “go out” (or self-quarantine) and, if so, whether to wear protection such as masks. Three elements distinguish the model from existing work. First, non-symptomatic agents do not know if they are infected. Second, some of these agents unknowingly transmit infections. Third, we permit two-sided prevention via the use of non-pharmaceutical interventions: the probability of a person catching the virus from another depends on protection choices made by each. We find that a mean-preserving increase in pre-existing income inequality unambiguously increases the equilibrium proportion of unprotected, socializing agents and may increase or decrease the proportion who self-quarantine. Strikingly, while higher pre-COVID inequality may or may not raise the overall risk of infection, it increases the risk of disease in social interactions.
We thank an anonymous referee and the editors of this journal for helpful feedback. Yu acknowledges financial support from “Innovation and Talent Base for Income Distribution and Public Finance, China
(B20084)”.