The COVID-19 consumption game-changer: evidence from a large-scale multi-country survey

Alexander Hodbod, Cars Hommes, Stefanie Huber and Isabelle Salle

No 2599, Working Paper Series from European Central Bank

Abstract: Prospective economic developments depend on the behavior of consumer spending. A key question is whether private expenditures recover once social distancing restrictions are lifted or whether the COVID-19 crisis has a sustained impact on consumer confidence, p references, and, hence, spending. The elongated and profound experience of the COVID-19 crisis may durably affect consumer preferences. We conducted a representative consumer survey in five European countries in summer 2020, after the release of the first wave’s lockdown restrictions, and document the underlying reasons for households’ reduction in consumption in five key sectors: tourism, hospitality, services, retail, and public transports. We identify a large confidence shock in the Southern European countries and a shift in consumer preferences in the Northern European countries, particularly among high-income earners. We conclude that the COVID-19 experience has altered consumer behavior and that long-term sectoral consumption shifts may occur. JEL Classification: D12, D81, D84, E21, E60, E71, G51, H30

Keywords: consumer preferences; consumption; COVID-19; economic resilience; expectations; experiences; fiscal policy; household behavior; sectoral changes; zombification (search for similar items in EconPapers)
Date: 2021-10
New Economics Papers: this item is included in nep-eec, nep-eur and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Related works:
Journal Article: The COVID-19 consumption game-changer: Evidence from a large-scale multi-country survey (2021)
Working Paper: The COVID-19 Consumption Game-Changer: Evidence from a Large-Scale Multi-Country Survey (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbwps:20212599

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