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COVID-19 social distancing measures and economic growth: Distinguishing short- and long-term effects

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  • Ashraf, Badar Nadeem
  • Goodell, John W.

Abstract

Social distancing policies have been criticized for their adverse effect on economies. However, we evidence that while they have a short-run adverse effect, they also have a long-run recovery effect on economic growth. Utilizing quarterly gross domestic product (GDP) growth rate data from OECD member states, we find that the medium-term recovery effect of stringent social distancing policies on economic growth is three times higher the short-term adverse effect. We additionally investigate social distancing measures with sub-components of GDP, as well as the conditioning roles of institutional factors.

Suggested Citation

  • Ashraf, Badar Nadeem & Goodell, John W., 2022. "COVID-19 social distancing measures and economic growth: Distinguishing short- and long-term effects," Finance Research Letters, Elsevier, vol. 47(PA).
    • Handle: RePEc:eee:finlet:v:47:y:2022:i:pa:s1544612321005742
    DOI: 10.1016/j.frl.2021.102639
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    1. Stephen Duckett, 2022. "Public Health Management of the COVID-19 Pandemic in Australia: The Role of the Morrison Government," IJERPH, MDPI, vol. 19(16), pages 1, August.
    2. Gu, Tiantian & Venkateswaran, Anand & Erath, Marc, 2023. "Impact of fiscal stimulus on volatility: A cross-country analysis," Research in International Business and Finance, Elsevier, vol. 65(C).
    3. Han, Wei & Wu, Di, 2023. "Internationalization and earnings management: Evidence from China," Finance Research Letters, Elsevier, vol. 53(C).
    4. Liu, Linqing & Yang, Lisi & Yan, Kai, 2023. "The power of clans: How social capital sheltered firms during the COVID-19 pandemic," Economics Letters, Elsevier, vol. 229(C).
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    6. Boubaker, Sabri & Goodell, John W. & Kumar, Satish & Sureka, Riya, 2023. "COVID-19 and finance scholarship: A systematic and bibliometric analysis," International Review of Financial Analysis, Elsevier, vol. 85(C).
    7. Yan, Huanmin & Liu, Zhenyu & Wang, Haoyu & Zhang, Xuehua & Zheng, Xilei, 2022. "How does the COVID-19 affect earnings management: Empirical evidence from China," Research in International Business and Finance, Elsevier, vol. 63(C).

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