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The Sooner, the Better : The Early Economic Impact of Non-Pharmaceutical Interventions during the COVID-19 Pandemic (English)

The size of the economic shocks triggered by the COVID-19 pandemic and the effects of the associated non-pharmaceutical interventions have not been fully assessed, because the official economic indicators have not been published. This paper provides estimates of the economic impacts of the non-pharmaceutical interventions implemented by countries in Europe and Central Asia over the initial stages of the COVID-19 pandemic. The analysis relies on high-frequency proxies, such as daily electricity consumption, nitrogen dioxide emission, and mobility records, to trace the economic disruptions caused by the pandemic, and calibrates these measures to estimate magnitude of the economic impact. The results suggest that the non-pharmaceutical interventions led to about a decline of about 10 percent in economic activity across the region. On average, countries that implemented non-pharmaceutical interventions in the early stages of the pandemic appear to have better short-term economic outcomes and lower cumulative mortality, compared with countries that imposed non-pharmaceutical interventions during the later stages of the pandemic. In part, this is because the interventions have been less stringent. Moreover, there is evidence that COVID-19 mortality at the peak of the local outbreak has been lower in countries that acted earlier. In this sense, the results suggest that the sooner non-pharmaceutical interventions are implemented, the better are the economic and health outcomes.

Details

  • Author

    Demirguc-Kunt,Asli, Lokshin,Michael M., Torre,Ivan

  • Document Date

    2020/05/26

  • Document Type

    Policy Research Working Paper

  • Report Number

    WPS9257

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Europe,

    Central Asia,

  • Region

    Europe and Central Asia,

  • Disclosure Date

    2020/05/26

  • Disclosure Status

    Disclosed

  • Doc Name

    The Sooner, the Better : The Early Economic Impact of Non-Pharmaceutical Interventions during the COVID-19 Pandemic

  • Keywords

    daily deaths; Electricity; per capita income growth; social distance; deaths per million; consumption; negative supply shock; education and health; use of electricity; high unemployment rate; consumption of electricity; loss of revenue; restrictions on travel; burden of disease; human capital outcomes; mobility of citizen; increase in labor; global value chain; lower mortality rate; negative health outcomes; public events; solid line; mobility pattern; grid electricity; school closure; nitrogen dioxide; mobility index; daily consumption; geographical region; high mortality; proxy measure; personal mobility; total load; economic shock; public debate; severe recession; ground level; industrial activity; positive value; negative value; horizontal axis; drastic measures; search engine; anecdotal evidence; grid area; national grid; anthropogenic source; natural origins; anthropogenic emission; recent work; nitrogen oxide; individual mobility; real gdp; daily measurements; sex ratio; Infant Mortality; manufacturing plant; labor shortage; coal industry; capacity utilization; Health cost; Economic Policy; economic distress; public health; disability rates; several months; electricity usage; electricity data; recent years; private investment; demand shock; urban planner; output growth; output data; aggregate demand; flu pandemic; electricity output; containment policy; national account; standard economic; official statistic; statistical system; negative effect; noncommunicable diseases; sars outbreak; recent past; Infectious Disease; warmer weather; consumption level; construction activities; world population; standard approach; satellite image; industrial center; Research Support; several decades; Homebased Work; mobile device; vertical line; development policy; open access; average change; cursory look; daily data; government response; negative relationship; human life; empirical analysis; heart disease; birth cohort; news source; Death rates; high wage; high capital; exponential growth; pandemic spread; widespread outbreak; real numbers; excess mortality; alternative measure; community outbreak; construction site; new cases; asian countries; weather condition; grid operator; mean value; personal income; epidemic curve; local outbreaks

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Citation

Demirguc-Kunt,Asli Lokshin,Michael M. Torre,Ivan

The Sooner, the Better : The Early Economic Impact of Non-Pharmaceutical Interventions during the COVID-19 Pandemic (English). Policy Research working paper,no. WPS 9257,COVID-19 (Coronavirus) Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/636851590495700748/The-Sooner-the-Better-The-Early-Economic-Impact-of-Non-Pharmaceutical-Interventions-during-the-COVID-19-Pandemic