Firm-level heterogeneity in the impact of the COVID-19 pandemic

Alejandro Fernández-Cerezo (), Beatriz González, Mario Izquierdo () and Enrique Moral-Benito
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Alejandro Fernández-Cerezo: Banco de España
Authors registered in the RePEc Author Service: Alejandro Fernandez Cerezo

No 2120, Working Papers from Banco de España

Abstract: This paper explores the heterogeneity across firms within each sector and region in the impact of and response to the COVID-19 shock. It relies on a survey conducted by Banco de España to 4,004 companies in November 2020 matched to very rich balance-sheet information on firm characteristics. According to our results, the impact of the COVID-19 shock was larger in the case of small, young and less productive firms located in urban areas within each sector-region pair. Moreover, these firms resorted relatively more to public-guaranteed loans, tax deferrals, and furlough schemes (ERTEs). More indebted companies, which were not hit relatively harder by the shock, also perceived public-guaranteed loans as very useful. Firms consider that uncertainty represents a key hindrance to the recovery, but observable characteristics do not explain the variation in the perception of uncertainty once the impact of the shock is accounted for. Finally, we use the announcement of the Pfizer vaccine on November 9th 2020 as a natural experiment to provide evidence that the vaccine announcement increased significantly firms’ subjective recovery expectations.

Keywords: COVID-19; firms; sales; employment; uncertainty (search for similar items in EconPapers)
JEL-codes: D22 L20 L25 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2021-05
New Economics Papers: this item is included in nep-cfn, nep-ent, nep-eur and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Related works:
Journal Article: Firm-level heterogeneity in the impact of the COVID-19 pandemic (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:2120

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