The COVID19 (coronavirus) pandemic and associated containment measures are expected to cause far-reaching damage to economies around the world. Firms are suffering from reduced demand due to movement restrictions, from reduced labor supply and from constraints to sourcing material inputs. The breakup of otherwise healthy businesses in response to a temporary shock implies large social costs. Governments are therefore intent on designing emergency policies to keep businesses afloat. In this brief, the authors present simulations using firm-level tax records from Ethiopia, which vary the duration of the lockdown and the relative impact across sectors.
Details
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Author
Bachas,Pierre Jean, Brockmeyer,Anne, Harris,Tom, Semelet,Camille Marine
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Document Date
2020/08/01
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Document Type
Brief
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Report Number
151978
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Volume No
1
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Total Volume(s)
1
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Country
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Region
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Disclosure Date
2021/07/19
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Disclosure Status
Disclosed
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Doc Name
The Impact of COVID-19 on Formal Firms : Evidence from Ethiopia
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Keywords
wage subsidy; Wage Subsidies; corporate income tax rate; loss in tax revenue; Wage Bill; loss in revenue; reduction in employment; fall in tax; increase in debt; machinery and equipment; leather goods stores; annual wage bill; general equilibrium model; reduction in subsidies; return to zero; compulsory social security; degree of heterogeneity; output loss; prevention measures; impact categories; demand shock; panel data; air transportation; petroleum product; monthly revenue; metal product; basic metal; tax records; emergency policy; electrical equipment; social cost; temporary shock; government support; government wage; rough indication; revenue category; average wage; short period; capital input; wage level; formal employment; paper product; back up; production capacity; administrative datum; increased revenue; smaller number; budget support; Trade Linkages; automotive part; partial equilibrium; bus transportation; aggregate output; Real estate; debt level; labor supply; indirect impact; personal service; performing art; amusement park; output shock; transport equipment; movement restriction; credit constraint; piece goods; Waste Management; retail trade; expected loss; home furnishings; Book Store; news dealers; store retailers
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Citation
Bachas,Pierre Jean Brockmeyer,Anne Harris,Tom Semelet,Camille Marine
The Impact of COVID-19 on Formal Firms : Evidence from Ethiopia (English). MTI Practice Note,no. 9D Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/212611598012154194/The-Impact-of-COVID-19-on-Formal-Firms-Evidence-from-Ethiopia