February, 2021

Essential or not?

Knowledge problems and COVID‐19 stay‐at‐home orders
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In response to the COVID‐19 pandemic, governments around the world issued stay‐at‐home orders, which required that individuals stay at home unless they were engaging in certain activities. Often these orders would designate certain goods and services as “essential” and would permit individuals engaged in the production, delivery, and purchase of those goods and services to leave their homes to do so. Implicit in these policies, of course, is the assumption that policymakers can know ex ante which goods and services are essential. As proved true while these stay‐at‐home orders were in effect, essentialness is necessarily subjective and depends on knowledge that is often dispersed, inarticulate, and changes over time. Policymakers, however, do not and often cannot have access to the local knowledge needed to determine ex ante which goods and services are essential, and they lack the feedback mechanisms they would need to adroitly adapt when circumstances change. This paper examines these knowledge problems associated with designating certain goods and services as “essential” when crafting and implementing stay‐at‐home orders.