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Financial Stress and COVID-19: A Comprehensive Analysis of the Factors Associated with the Pandemic

Author

Listed:
  • Keewon Moon

    (Exodus & Flying Education, Seoul 05675, Republic of Korea)

  • Wookjae Heo

    (School of Hospitality & Tourism Management, Purdue University, West Lafayette, IN 47907, USA)

  • Jae Min Lee

    (Department of Family Consumer Science, Minnesota State University, 102 Wiecking Center, Mankato, MN 56001, USA)

  • John E. Grable

    (Department of Financial Planning, Housing and Consumer Economics, University of Georgia, 305 Sanford Drive, Athens, GA 30602, USA)

Abstract

The COVID-19 pandemic introduced unprecedented challenges for households globally, serving as a precursor to and trigger for financial stress. This study examined the associations across various factors thought to be associated with financial stress (a psychological syndrome) resulting from the COVID-19 pandemic. Using survey data collected in 2019 ( n = 997) and 2021 ( n = 988), propensity score matching and hierarchical linear modeling were employed to identify the association between financial stress and the pandemic. Results indicated that financial stress increased during the COVID-19 pandemic. Three covariate groups, including financial characteristics, health status, and socio-demographic characteristics, were found to be associated with financial stress levels. The primary contribution of this paper lies in offering a comprehensive understanding of how the dynamics of financial stress evolve with shifting macroeconomic events. This paper serves as a framework to employ a comprehensive financial stress measure and matched samples at various data points. Findings from this study contribute to the existing literature on financial well-being, financial stress, and societal outcomes associated with global health events while providing implications for policy and practice.

Suggested Citation

  • Keewon Moon & Wookjae Heo & Jae Min Lee & John E. Grable, 2023. "Financial Stress and COVID-19: A Comprehensive Analysis of the Factors Associated with the Pandemic," Risks, MDPI, vol. 11(12), pages 1-24, December.
    • Handle: RePEc:gam:jrisks:v:11:y:2023:i:12:p:218-:d:1299383
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    References listed on IDEAS

    as
    1. Akhtaruzzaman, Md & Boubaker, Sabri & Sensoy, Ahmet, 2021. "Financial contagion during COVID–19 crisis," Finance Research Letters, Elsevier, vol. 38(C).
    2. Patrick L. Leoni, 2013. "Hiv/Aids And Banking Stability In Developing Countries," Bulletin of Economic Research, Wiley Blackwell, vol. 65(3), pages 225-237, July.
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