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The economic reaction to non-pharmaceutical interventions during Covid-19

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  • Segarra-Blasco, Agustí
  • Teruel, Mercedes
  • Cattaruzzo, Sebastiano

Abstract

Policy makers have implemented a set of non-pharmaceutical interventions (NPIs) to contain the spread of Covid-19 and reduce the burden on health systems. These restrictive measures have had adverse effects on economic activity; however, these negative impacts differ with respect to each country. Based on daily data, this article studies governmental economic responses to the application of NPIs for 59 countries. Furthermore, we assess if these economic responses differ according to the economic and sectoral context of the countries. By applying a counting model to the economic support intensity, our results quantify the average reaction of governments in counterbalancing the imposition of NPIs. We further re-estimate the base model by dividing the countries according to their GDP per capita, the intensity of their service sectors, and the expenditure by tourists. Our results show how each NPI implied a different level of economic support and how the structural characteristics considered were relevant to the decision-making process.

Suggested Citation

  • Segarra-Blasco, Agustí & Teruel, Mercedes & Cattaruzzo, Sebastiano, 2021. "The economic reaction to non-pharmaceutical interventions during Covid-19," Economic Analysis and Policy, Elsevier, vol. 72(C), pages 592-608.
    • Handle: RePEc:eee:ecanpo:v:72:y:2021:i:c:p:592-608
    DOI: 10.1016/j.eap.2021.10.006
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    More about this item

    Keywords

    Covid-19; Economic policies; Non-pharmaceutical interventions; Daily time data;
    All these keywords.

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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