Tracking the Economic Impact of COVID-19 and Mitigation Policies in Europe and the United States

Sophia Chen (), Deniz Igan, Nicola Pierri and Andrea Presbitero

No 2020/125, IMF Working Papers from International Monetary Fund

Abstract: We use high-frequency indicators to analyze the economic impact of COVID-19 in Europe and the United States during the early phase of the pandemic. We document that European countries and U.S. states that experienced larger outbreaks also suffered larger economic losses. We also find that the heterogeneous impact of COVID-19 is mostly captured by observed changes in people’s mobility, while, so far, there is no robust evidence supporting additional impact from the adoption of non-pharmaceutical interventions. The deterioration of economic conditions preceded the introduction of these policies and a gradual recovery also started before formal reopening, highlighting the importance of voluntary social distancing, communication, and trust-building measures.

Keywords: WP; economic activity; Non-Pharmaceutical Interventions; weakening economy; COVID-19; Mitigation policies; Pandemic; Electricity; Labor market; mitigation policy; NPI adopter; state level; NPIs introduction; economic recovery; Google community mobility; policy response; hit country; NPI timing; Unemployment; Labor markets; Europe; energy consumption; anticipation effect; Unemployment benefits (search for similar items in EconPapers)
Pages: 25
Date: 2020-07-10
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Citations: View citations in EconPapers (83)

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