The impact of containment measures across sectors and countries during the COVID-19 pandemic

Niccolò Battistini and Grigor Stoevsky

Economic Bulletin Boxes, 2021, vol. 2

Abstract: This box shows how the economic impact of containment measures adopted in response to the pandemic differed across sectors and countries, and over time. The impact is assessed with a cross-sector vector autoregression (VAR) model. The results confirm that containment measures had a relatively large impact on sectors with non-teleworkable, contact-intensive occupations, such as recreational services. They also show that the impact of the measures varied across countries largely due to the different economic structures and containment policies. There is evidence that economic agents learned how to cope with the restrictions over time. This suggests that more targeted measures, coupled with behavioural responses by households and firms, helped limit the economic costs of containment policies during the renewed wave. Looking ahead, the large divergence in the economic impact of restrictions across sectors is likely to persist at least in the short term. JEL Classification: E23, E27, E32

Keywords: COVID-19 economic impact; sectoral activity; time-varying parameters VAR (search for similar items in EconPapers)
Date: 2021-03
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Citations: View citations in EconPapers (7)

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