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 hd5f2, SocArXiv from Center for Open Science

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 9 percentage points decline due to COVID-19, even though the Japanese anti-contagion policy was in a form of the government’s request that is not legally enforceable. Second, using a discontinuity in the eligibility criteria, we find lump-sum and prompt 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 the anti-contagion policies could complement longer-run economic goals.

Date: 2021-05-10
New Economics Papers: this item is included in nep-ent and nep-sbm
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Citations: View citations in EconPapers (2)

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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 (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:hd5f2

DOI: 10.31219/osf.io/hd5f2

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