Belief-Driven Dynamics in a Behavioral SEIRD Macroeconomic Model with Sceptics

The reluctance of a significant number of individuals in the current COVID-19 pandemic to adhere to social distancing measures -- and even to get vaccinated -- seems to be one of the major obstacles for the long-term success of public health policies around the world. Against this background we study the impact of boundedly rational perceptions for the dynamics of epidemics such as the COVID-19 pandemic in a standard epidemic model extended by a stylized macroeconomic dimension similar to Atkeson et al. (2021). We show through which channels misperceptions or even ``scepticism'' concerning the infectiousness of the disease or its mortality rate may undermine the effectiveness of lockdowns and other public health policies in the long-run