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Consumption in the time of Covid-19: Evidence from UK transaction data

Author

Listed:
  • Surico, Paolo
  • Känzig, Diego
  • HacıoÄŸlu Hoke, Sinem

Abstract

Using transaction data from a large Fintech company, we document a decline of 40% to 50% in the spending of British households during the Covid-19 crisis. The fall is concentrated in services such as retail, restaurants and transportation. The initial rise in on-line shopping and groceries purchases has been subsequently reverted. Income reductions have become far more frequent, with a median decline around 30%. The share of borrowers facing financing issues has increased significantly for both secured and unsecured lending. Consumption and income inequality have surged, with the most economically vulnerable groups experiencing the largest percentage decline. Mortgagors and higher earners in London record the most sizable pound change.

Suggested Citation

  • Surico, Paolo & Känzig, Diego & HacıoÄŸlu Hoke, Sinem, 2020. "Consumption in the time of Covid-19: Evidence from UK transaction data," CEPR Discussion Papers 14733, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:14733
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    More about this item

    Keywords

    Real-time indicators; Expenditure; Income; Access to finance;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth

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