The Causal Effects of Lockdown Policies on Health and Macroeconomic Outcomes

Jonas E. Arias, Jesus Fernandez-Villaverde, Juan F Rubio-Ramirez and Minchul Shin

American Economic Journal: Macroeconomics, 2023, vol. 15, issue 3, 287-319

Abstract: We assess the causal impact of pandemic-induced lockdowns on health and macroeconomic outcomes and measure the trade-off between containing the spread of a pandemic and economic activity. To do so, we estimate an epidemiological model with time-varying parameters and use its output as information for estimating SVARs and LPs that quantify the causal effects of nonpharmaceutical policy interventions. We apply our approach to Belgian data for the COVID-19 pandemic during 2020. We find that additional government-mandated mobility curtailments would have reduced deaths at a very small cost in terms of GDP.

JEL-codes: E23 H51 I12 I15 I18 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (14)

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DOI: 10.1257/mac.20210367

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