Assessing The Impact of The Lockdown in Jakarta on The Economy: An Input–Output Approach

Achmad Rifa’i

A chapter in Macroeconomic Risk and Growth in the Southeast Asian Countries: Insight from Indonesia, 2023, vol. 33A, pp 93-105 from Emerald Group Publishing Limited

Abstract: With the outbreak of COVID-19 at the beginning of 2020, many countries attempted to control the spread of the virus by implementing a lockdown policy. This study investigates the impact of the lockdown in Jakarta in 2020 on the economy. The database used the Input–Output (IO) 2015. We employed a bottom-up approach by selecting Jakarta to generate the shock on the economy since only Jakarta constantly applied the lockdown policy named Large-Scale Social Restriction (PSBB) policy in 2020. We earned some useful information on whether the shock in Jakarta significantly impacted the national economy as well as other provinces. Our empirical results revealed that the PSBB policy reduced output in Jakarta by 7.20%, value-added declined by about 8.04%, income waned by 8.08%, and labour shrank by 7.68%. We also found that national output decreased by 1.30% in other provinces, especially those depending on the agricultural sector.

Keywords: COVID-19; lockdown; input–output; PSBB; Jakarta; Indonesia; E01; E61; H12; P16; L38 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eme:isetez:s1571-03862023000033a007

DOI: 10.1108/S1571-03862023000033A007

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