Understanding the impact of the COVID-19 pandemic through an import-adjusted breakdown of euro area aggregate demand

Malin Andersson, Leyla Beck and Yiqiao Sun

Economic Bulletin Boxes, 2021, vol. 8

Abstract: The coronavirus (COVID-19) pandemic and the lockdown measures to contain its spread caused large cumulated losses in euro area domestic demand in the first half of 2020, with a rebound in the third quarter of the year, according to the standard expenditure-based breakdown of GDP. However, an adjustment for import intensities derived from input-output data shows that external factors have also contributed significantly to growth dynamics in 2020. While an extended analysis based on ratios of sectoral imports to value added as a proxy suggests that import intensities may have, in aggregate, risen somewhat in the current crisis, this does not have a significant impact on the alternative, import-adjusted GDP breakdown for 2020. JEL Classification: E21, E23, E32

Keywords: Economic growth; imports; input output (search for similar items in EconPapers)
Date: 2021-01
Note: 427284
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