 The Economic Impacts of COVID-19: Evidence from a New Public Database Built Using Private Sector Data*Raj Chetty, John N Friedman, Michael Stepner, Opportunity Insights Team, Camille Baker, Harvey Barnhard, Matt Bell, Gregory Bruich, Tina Chelidze, Lucas Chu, Westley Cineus, Sebi Devlin-Foltz, Michael Droste, Dhruv Gaur, Federico Gonzalez, Rayshauna Gray, Abigail Hiller, Matthew Jacob, Tyler Jacobson, Margaret Kallus, Fiona Kastel, Laura Kincaide, Caitlin Kupsc, Sarah LaBauve, Lucía Lamas, Maddie Marino, Kai Matheson, Jared Miller, Christian Mott, Kate Musen, Danny Onorato, Sarah Oppenheimer, Trina Ott, Lynn Overmann, Max Pienkny, Jeremiah Prince, Sebastian Puerta, Daniel Reuter, Peter Ruhm, Tom Rutter, Emanuel Schertz, Shannon Felton Spence, Krista Stapleford, Kamelia Stavreva, Ceci Steyn, James Stratton, Clare Suter, Elizabeth Thach, Nicolaj Thor, Amanda Wahlers, Kristen Watkins, Alanna Williams, David Williams, Chase Williamson, Shady Yassin, Ruby Zhang and Austin Zheng The Quarterly Journal of Economics, 2024, vol. 139, issue 2, 829-889 Abstract: We build a publicly available database that tracks economic activity in the United States at a granular level in real time using anonymized data from private companies. We report weekly statistics on consumer spending, business revenues, job postings, and employment rates disaggregated by county, sector, and income group. Using the publicly available data, we show how the COVID-19 pandemic affected the economy by analyzing heterogeneity in its effects across subgroups. High-income individuals reduced spending sharply in March 2020, particularly in sectors that require in-person interaction. This reduction in spending greatly reduced the revenues of small businesses in affluent, dense areas. Those businesses laid off many of their employees, leading to widespread job losses, especially among low-wage workers in such areas. High-wage workers experienced a V-shaped recession that lasted a few weeks, whereas low-wage workers experienced much larger, more persistent job losses. Even though consumer spending and job postings had recovered fully by December 2021, employment rates in low-wage jobs remained depressed in areas that were initially hard hit, indicating that the temporary fall in labor demand led to a persistent reduction in labor supply. Building on this diagnostic analysis, we evaluate the effects of fiscal stimulus policies designed to stem the downward spiral in economic activity. Cash stimulus payments led to sharp increases in spending early in the pandemic, but much smaller responses later in the pandemic, especially for high-income households. Real-time estimates of marginal propensities to consume provided better forecasts of the impacts of subsequent rounds of stimulus payments than historical estimates. Overall, our findings suggest that fiscal policies can stem secondary declines in consumer spending and job losses, but cannot restore full employment when the initial shock to consumer spending arises from health concerns. More broadly, our analysis demonstrates how public statistics constructed from private sector data can support many research and real-time policy analyses, providing a new tool for empirical macroeconomics. Date: 2024 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:oup:qjecon:v:139:y:2024:i:2:p:829-889. Ordering information: This journal article can be ordered from Access Statistics for this article The Quarterly Journal of Economics is currently edited by Robert J. Barro, Lawrence F. Katz, Nathan Nunn, Andrei Shleifer and Stefanie Stantcheva More articles in The Quarterly Journal of Economics from President and Fellows of Harvard College |
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