It was the summer of 2010, a hot Saturday afternoon, and following a sweaty morning in the garden, I settled on the deck with my favourite beer and a smoked meat sandwich. Two bites and three sips in, the opening riff to Satisfaction by the Rolling Stones punctured my peace.
Now, I am a Stones fan, but this "music" was coming from my neighbour’s yard, played by the 13-year-old son, who had received a guitar and amp for his birthday. Three hours of badly played rock ’n’ roll, on an out-of-tune guitar, and I was bonkers.
Economists call such incidents an externality. When my activity or behaviour affects your production or consumption, this is an externality. The badly played music that affected my quiet enjoyment on a summer afternoon is a trite example of a negative externality. Pollution is a more important example. Trees I plant on my urban property create community benefits beyond the shade I receive, thereby creating positive externality.
A central idea in externalities is that personal costs and benefits understate the social costs and benefits. In serious pandemics, this divergence is extreme. We often underestimate the social costs of our choices.
COVID-19 is the mother of all negative externalities. Once I am infected, anyone I approach risks contracting the disease based on proximity, duration, context and, apparently, how loudly I talk. This is the nature of aerosol transmission. In other words, COVID-19 is an STD — socially transmitted disease.
The capacity of SARS-CoV-2, the pathogen that causes COVID-19, to mutate and replicate presents a constant biological challenge; human behaviour creates additional layers of risk and complexity to public policy. While many externalities are local — the noise from my neighbour falls off after 100 metres or so — pandemic pathogens are global, demanding a concerted and co-ordinated attack.
We manage externalities in three ways. First, we can just put up with the issue. In the case of my young neighbour’s excruciating playing, thankfully he soon realized that a career of being a rock star was unlikely and the guitar eventually found its true calling in a garage sale. Doing nothing is sometimes the best policy.
COVID-19 has created high global death tolls with staggering economic losses, and the new variants threaten to prolong the agony, so doing nothing is not on.
A second approach to managing externalities are nuisance laws and regulations such as zoning. But enforcement is costly, and those affected can endure years of annoyance. COVID-19 is also much more than a nuisance.
A third approach are systems of incentives and penalties. Recent information from Prairie Research Associates shows a role exists for education and promotion among vaccine-hesitant groups. A history of poor experiences with the health-care system has encouraged some to avoid vaccination. Financial support for community groups to promote vaccination makes sense.
This is probably not enough. We are far from herd immunity, and with the delta variant on the prowl in Manitoba, a risk exists that the current wave may not abate quickly. The current vaccines still offer important immunity against new variants… so far. Driving vaccination rates to the 70 per cent epidemiologists say we need will likely require penalties for those who do not vaccinate.
Already in the U.S., countless universities have mandated full vaccinations for all students and staff for the fall term. Here at the University of Manitoba, the fall term will be partially in person for smaller classes, but virtual for all the large sessions; I am reluctant to step back into the class without similar vaccine mandates. I have also grown comfortable in delivering online classes and my students saw many advantages to this approach.
Government may not need to compel vaccinations for mass indoor events. I am not prepared to go back to a Jets game (leaving aside the recent dismal playoff experience against the Montreal Canadiens) and sit among unvaccinated buffoons yelling at the top of their lungs, while spilling beer down my neck. We already accept the need to pass through a metal detector to see a hockey game; showing a vaccine passport is trivial.
Organizers of indoor concerts, plays, and sporting events may find that their sales depend on assuring patrons that all attendees have received full immunization. Many will impose vaccine requirements without prompting. Governments’ role would be to support the enforcement of these measures through checking the validity of the documents and imposing penalties for presenting counterfeits.
We are not going back to normal. The nature of the pandemic, its high negative externalities and the potential havoc caused by the lambda variant (yet to emerge) require us to accept new rules and responsibilities to create an acceptable facsimile of normal that is better than the current dreariness.
Gregory Mason is an associate professor of economics at the University of Manitoba.