Contact tracing apps were presented to the public as an important tool in fighting the spread of COVID19 (University of Oxford, 2020). In Australia, the COVIDSafe app (Department of Health, 2020) was launched by the Australian Federal Government and Chief Medical Officer (Prime Minister of Australia, 2020). The public were encouraged to download and use the app. However, the target of 40% download target was not achieved (Meixner, 2020).
A search of the media and academic literature presents many theories/hypothesises as to why this is the case. These range from a lack of understanding of the data that was being collected, how collected data was to be stored, data protection issues, concerns about privacy breaches, along with more day to day pragmatic issues including concerns that the app would drain phone batteries quickly and to up-take (or not) reflecting political allegiances. For example, see Lee et al. (2020) and Thomas et al. (2020).
In the absence of a vaccine, given the economic impact of border controls and lock downs, the current Chief Health Minister for Queensland is interested in understanding if the COVIDSafe app (or equivalent) could be successfully resurrected as part of a range of tools for managing [controlling/mitigating/supressing] community transmission.
From an economics perspective it is no surprise that the app failed to achieve its targets. The purpose of this research essay is to explore the economics behind the uptake of the COVIDSafe app and potential policy solutions (Hawkins and Freyens (2020), Holden (2020) and Volk, (2020)).
The current Chief Health Minister for Queensland has asked you to summarise the economics perceptive in an essay format which includes the following
1. An overview of the rationale behind the COVIDSafe app and data on its uptake. (International comparisons are encouraged).
2. Presentation of (inclusive of a supporting explanation) an economic model that identifies the optimal uptake of the COVIDSafe app and the actual (suboptimal) uptake of the COVIDSafe app.
3. Investigation of the following TWO economic policies and a critical analysis of how they could potentially increase up take of the relaunch of COVIDSafe app (or equivalent):
a. Monetary incentive
b. Behavioural economics approach (non-monetary incentive)
You are required to support your economic analysis with appropriate data and economic models (partial equilibrium analysis) which you use to examine how the policy achieves the desired outcome. A brief summary of the potential economic effects (costs and benefits) of each of the above policies is required. However, it is appreciated that a full analysis of effects of these policy solutions is beyond the scope of this work.