Small Business under the COVID-19 Crisis: Expected Short- and Medium-Run Effects of Anti-Contagion and Economic Policies

Kohei Kawaguchi, Naomi Kodama and Mari Tanaka

No DP20-002, SSPJ Discussion Paper Series from Service Sector Productivity in Japan: Determinants and Policies, Institute of Economic Research, Hitotsubashi University

Abstract: This study makes a causal inference on the effects of anti-contagion and economic policies on small business by conducting a survey on Japanese small business managers’ expectations about the pandemic, policies, and firm performance. We first find the business suspension request decreased targeted firms’ sales by 10 percentage points on top of the baseline 8 percentage points decline due to COVID-19. Second, using a discontinuity in the eligibility criteria, we find lump-sum subsidies improved firms’ prospects of survival by 19 percentage points. Third, the medium-run recovery of firms’ performance is expected to depend crucially on when infections would end, indicating that stringent anti-contagion policies could complement longer-run economic goals.

Keywords: COVID-19; Causal inference; Manager’s expectation; Business performance; Subsidy; Small business; Regression Discontinuity Design; Randomized controlled trial; Difference-in-Difference; Pandemic; Infection; Anti-contagion policies; Lockdown; Survey (search for similar items in EconPapers)
JEL-codes: D22 D80 D84 E17 E32 E66 I18 L50 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2020-11
New Economics Papers: this item is included in nep-ent, nep-mac and nep-sbm
Note: November 20, 2020, The latest version of the paper including the online appendix is in https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3634544.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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https://hermes-ir.lib.hit-u.ac.jp/hermes/ir/re/71536/DP20-002.pdf

Related works:
Journal Article: Small business under the COVID-19 crisis: Expected short- and medium-run effects of anti-contagion and economic policies (2021)
Working Paper: Small Business under the COVID-19 Crisis: Expected Short- and Medium-Run Effects of Anti-Contagion and Economic Policies (2021)
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