Economic impact of targeted government responses to COVID-19: Evidence from the large-scale clusters in Seoul

Jinwook Shin, Seonghoon Kim and Kanghyock Koh

Journal of Economic Behavior & Organization, 2021, vol. 192, issue C, 199-221

Abstract: We estimate the economic impact of South Korea's targeted responses to the large-scale COVID-19 clusters in a highly concentrated business area (Guro) and a highly concentrated entertainment area (Itaewon) in Seoul, respectively. We find that foot traffic and retail sales decreased only within a 300 m radius and recovered to their pre-outbreak level after four weeks in the case of the Guro cluster. The reductions appear to be driven by temporary business closures rather than by citizens' risk avoidance behavior. However, the adverse economic impacts measured by foot traffic and retail sales of another outbreak of the COVID-19 cluster in Itaewon were persistent. Our results imply that the effects of less intense but more targeted COVID-19 interventions, such as pinpointed, temporary closures of businesses, can differ by underlying geographical characteristics.

Keywords: COVID-19; Information disclosure; Risk avoidance; Foot traffic; Retail sales; Card transaction data (search for similar items in EconPapers)
JEL-codes: E2 H12 I12 I18 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:192:y:2021:i:c:p:199-221

DOI: 10.1016/j.jebo.2021.10.013

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