Based on a standard epidemiological model, we derive and apply empirical tests of the hypothesis that contacts, as proxied by mobility data, have an effect on the spread of the coronavirus epidemic, as summarized by the reproduction rates, and on economic activity, as captured by subsequent initial claims to unemployment benefits. We show that changes in mobility through the first quarters of 2020, be it spontaneous or mandated, had significant effects on both the spread of the coronavirus and the economy. Strikingly, we find that spontaneous social distancing was no less costly than mandated social distancing. Our results suggest that the rebound in economic activity when stay-at-home orders were lifted was primarily driven by the improvement in epidemiological parameters. In other words, without the reduction in the reproduction rate of the coronavirus, we could have expected a doubling down on spontaneous social distancing.
Corsetti, G, L Guerrieri and M Bodenstein (2021), ‘Economic and Epidemiological Effects of Mandated and Spontaneous Social Distancing‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_390738
This paper examines employment patterns by wage group over the course of the coronavirus pandemic in the United States using microdata from two well-known data sources from the Bureau of Labor Statistics: the Current Employment Statistics and the Current Population Survey. We find that both establishments paying the lowest average wages and the lowest wage workers had the steepest decline in employment and are still the furthest from recovery as of the most recent data for workers in December 2020 and establishments in January 2021. We disentangle the extent to which the effect observed for low wage workers is due to these workers being concentrated within a few low wage sectors of the economy versus the pandemic affecting low wage workers in a number of sectors across the economy. Our results indicate that the experience of low wage workers is not entirely due to these workers being concentrated in low wage sectors â€“ for many sectors, the lowest wage quintile in that sector also has had the worst employment outcomes. For each month from March 2020 to January 2021, at least 20% of the decline in employment among the lowest wage establishments was due to within-industry changes. Another important finding is that even for those who remain employed during the pandemic, the probability of becoming part-time for economic reasons increased, especially for low-wage workers.
Polivka, A, D Piccone, J Groen, M Loewenstein and M Dalton (2021), ‘The K-Shaped Recovery: Examining the Diverging Fortunes of Workers in the Recovery from the COVID-19 Pandemic using Business and Household Survey Microdata‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_390737
Is there a connection between the 2007-2009 financial crisis and the COVID-19 pandemic? To answer this question we examine the relation between both macroeconomic and financial losses derived from the financial crisis and the health outcomes associated with the first wave of the pandemic. At the European level, countries more affected by the financial crisis had more deaths relative to coronavirus cases. We find an analogous significant relation across Spanish provinces and a transmission mechanism running from finance to health outcomes through cross-sectional differences in health facilities.
Wagner, A, S Ongena, A Ventula Veghazy and A Moreno Ibáñez (2021), ‘Misfortunes Never Come Alone: From the Financial Crisis to the Covid-19 Pandemic‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_391067
We estimate that the short to medium-term fiscal impact of previous pandemics has been significant in 170 countries (including low-income countries) during the 2000-2018 period. The impact has varied, with pandemics affecting government expenditures more than revenues in advanced economies, while the converse applies to developing countries. Using a subset of 45 developing countries for which tax reform data are available, we find that past pandemics have propelled countries to implement tax reforms, particularly in corporate income taxes, excises and property taxation. Pandemics do not drive revenue administration reforms.
Jalles, J and S Gupta (2021), ‘Can Covid-19 Induce Governments to Implement Tax Reforms in Developing Countries?‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_390736
The current Covid-19 pandemic is a stochastic shock that impacts all Australian women irrespective of individual difference. While not every person will contract coronavirus, every Australian woman has experienced a stress reaction impacting their psychological, regulatory, or behavioural responses. Our study employs a repeated measures survey from (n=420) Australian women in June (n=207) and September 2020. We analyse the relationship between womenâ€™s demographics, personality, mental and physical health, their Covid-19 knowledge and stated risk preferences, to identify factors impacting coping behaviors employed using the BriefCope scale. We find that both age and personality are key factors impacting both choice and type of coping strategy employed. With younger Australian women (compared to older) more likely to engage a coping strategy. Interestingly, womenâ€™s income and self-rated general health showed no statistically significant relationship with any of the 14 strategies in the BriefCope scale. Further our repeated measures analysis shows that women aged 40 years and below report greater increases in the use of avoidant (denial, substance use, venting and self-blame) and approach coping (emotional and instrumental support) compared to older women in our cohort. We also find that across time, younger Australian women exhibit higher propensities for risk compared with older Australian women. Our findings of key age & time effects for Australian womenâ€™s willingness or choice to enact a coping strategy warrants further research into the underlying drivers of such pronounced generational difference.
Whyte, S, M Godwin, R Russell-Bennett and U Dulleck (2021), ‘Coping with Covid: Australian women’s coping responses during the Covid-19 pandemic‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_390815
This paper provides an ex-post analysis of football matchesâ€™ contribution to the spread of COVID-19 during Germanyâ€™s second infection wave in summer and autumn 2020. We find slightly positive effects from occurring professional football matches on newly registered cases of the virus in the respective counties. An upper boundary gives us that an additional match in a county on average raises the number of daily registered cases by up to between 0.52 and 0.91 cases per 100,000 inhabitants after three weeks. Hence, this on average implies an increase in the seven-day incidence per 100,000 inhabitants by up to between 3.6 and 6.4. We do not find qualitatively different results in a subsample of German top league matches which were associated to have the strictest hygiene regulations. Most importantly, the found effect is mediated by the incidence level at the day of the match with very few infections for matches at a seven-day incidence below 25. As an underlying mechanism, we identify increases in the local mobility. Further, infections are not explicitly driven by higher occupancy levels. We finally show that the ban of away fans successfully restricts the spread of COVID-19 beyond county borders and also find indication for a reduced effect from football matches in the presence of the â€™lockdown lightâ€™ which Germany launched in early November.
Fischer, K (2021), ‘Thinning out Spectators: Did Football Matches Contribute to the Second COVID-19 Wave in Germany?‘, COVID Economics 71, CEPR Press, Paris & London. https://cepr.org/publications/covid-economics-issue-71#392514_392947_390735