Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223550
Authors: 
Brotherhood, Luiz
Jerbashian, Vahagn
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper No. 8478
Abstract: 
We derive a model in which firms operate in an epidemic environment and internalize infections among their employees in the workplace. The model is calibrated to fit the properties of the Covid-19 epidemic. We show that firms have incentives to fight against infections and can do so very effectively by increasing teleworking and rotating employees between on-site work, teleworking, and leave. Subsidies to sick leave reduce the cost of sick workers and raise workplace infections. Furlough policies are successful in reducing infections and saving lives. Firms delay and weaken the fight against infections during economic downturns.
Subjects: 
Covid-19
epidemic
firm behaviour
on-site work
policies
teleworking
JEL: 
C63
D20
D21
I10
I18
L23
Document Type: 
Working Paper

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