Is no news bad news? The impact of disclosing COVID‐19 tracing information on consumer dine out decisions

Yuan Gao, Rigoberto Lopez, Ruili Liao and Xiaoou Liu

Agricultural Economics, 2022, vol. 53, issue 5, 811-825

Abstract: Food markets around the world have been disrupted by the COVID‐19 pandemic via consumer behavior upended by fear of infection. In this article, we examine the impact of disclosing COVID‐19 contact tracing information on food markets, using the restaurant industry in China as a case study. By analyzing transaction data at 87 restaurants across 10 cities, we estimate difference‐in‐difference (DID) models to ascertain the impact of COVID‐19 infections and contact information tracing on economic activity as measured by a daily number of transactions. Empirical results show that while the overall number of new COVID‐19 infections at the national level caused a dramatic drop in numbers of transactions in all restaurants, restaurants in cities that disclosed contact tracing information of COVID‐19 infections experienced a 23%–35% higher number of transactions than the ones in cities that did not disclose such information during the recovery period. Ultimately, we show that in the absence of a shelter‐in‐place mandate, disclosing contract tracing information to mitigate consumers’ uncertainties about risks of being infected can contribute to a faster recovery of food markets, in addition to reducing COVID‐19 infections.

Date: 2022
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