This is the Cato Daily Podcast for Wednesday, April 7th, 2021.

I'm Caleb Brown.

The pandemic has given us many opportunities to see the value in thinking like an economist,

Cato's Ryan Bourne, is now chronicled the good and bad economic reasoning

and decisions both public and private. In his new book, Economics in One virus, an introduction

to economic reasoning through COVID-19 released today.

What follows is our conversation about the book for this month's edition of Kido Audio.

Ryan, it wasn't that long after the United States began taking this seriously.

I think that was probably mid to late February that government started to respond and what would you say is the first big error

that governments made either in this country or around the globe in responding to

this virus? Well I think it's almost kind of become a the who said that the testing debacle early on was kind of the original scene of the pandemic response.

The pandemic in many ways is what economists Joshua Gans has kind of described as an information problem.

Some people have a virus, we don't know who has the virus, we don't know who's at risk of getting the virus from interacting with those people.

So the country had quite a narrow window of opportunities to try and identify who had the virus to stamp out clusters of cases,

identify where the virus was spreading, and then implement quite kind of targeted measures to stem the flow of the disease and allow people to maintain as much normality as possible.

The problem was the government, the FDA in particular, introduced an emergency

use authorization process which slowed down the process of diagnostic test approval it banned university labs from

undertaking their own tests the CDC bungled its test produced a faulty test and as a result of that we didn't know who had the virus and

that delay over a couple of months led to a massive spread through the population.

Now it's really important to understand I think where this links into my book

is important to understand the economic mistake being made because public officials were

obviously worried about dodgy tests and the fact that if we had tests that were given

...