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Subsidizing the spread of COVID19: Evidence from the UK’s Eat-Out-to-Help-Out scheme

Author

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  • Fetzer, Thiemo

    (University of Warwick and CAGE)

Abstract

This paper documents that a large-scale government subsidy aimed at encouraging people to eat out in restaurants in the wake of the first 2020 COVID19 wave in the United Kingdom has had a large causal impact in accelerating the subsequent second COVID19 wave. The scheme subsidized 50% off the cost of food and non-alcoholic drinks for an unlimited number of visits in participating restaurants on Mondays-Wednesdays from August 3 to August 31, 2020. Areas with higher take-up saw both, a notable increase in new COVID19 infection clusters within a week of the scheme starting, and again, a deceleration in infections within two weeks of the program ending. Areas that exhibit notable rainfall during the prime lunch and dinner hours on days the scheme was active record lower infection incidence – a pattern that is also measurable in mobility data – and non-detectable on days during which the discount was not available or for rainfall outside the core lunch and dinner hours. A back of the envelope calculation suggests that the program is accountable for between 8 to 17 percent of all new local infection clusters during that time period.

Suggested Citation

  • Fetzer, Thiemo, 2020. "Subsidizing the spread of COVID19: Evidence from the UK’s Eat-Out-to-Help-Out scheme," CAGE Online Working Paper Series 517, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:517
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp.517.2020.pdf
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    RePEc Biblio mentions

    As found on the RePEc Biblio, the curated bibliography for Economics:
    1. > Economics of Welfare > Health Economics > Economics of Pandemics > Specific pandemics > Covid-19 > Health > Distancing and Lockdown

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    Cited by:

    1. Dan Degerman & Elliott Johnson & Matthew Flinders & Matthew Johnson, 2024. "After nudging: the ethical challenge of post-pandemic policymaking in the UK," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 11(1), pages 1-9, December.
    2. Gonzalez-Pampillon, Nicolas & Nunez-Chaim, Gonzalo & Overman, Henry G., 2024. "The economic impacts of the UK's eat out to help out scheme," Journal of Urban Economics, Elsevier, vol. 143(C).
    3. Fetzer, Thiemo & Graeber, Thomas, 2020. "Does Contact Tracing Work? Quasi-Experimental Evidence from an Excel Error in England," CEPR Discussion Papers 15494, C.E.P.R. Discussion Papers.
    4. Esteban Jaimovich, 2024. "The Intensive Margin of Altruism: Impact of Covid-19 on Charitable Giving in England and Wales," Working Papers 297, Red Nacional de Investigadores en Economía (RedNIE).
    5. Richard Machin, 2023. "UK local government experience of COVID-19 Lockdown: Local responses to global challenges," Local Economy, London South Bank University, vol. 38(1), pages 80-91, February.
    6. Guzman-Tordecilla, Deivis Nicolas & Trujillo, Antonio J., 2025. "Economic and health implications of early COVID-19 lockdown exits: Evidence from a difference-in-differences analysis," Social Science & Medicine, Elsevier, vol. 372(C).
    7. Rufrancos, Héctor & Moro, Mirko & Moore, Eva, 2021. "The impact of University reopenings on COVID-19 cases in Scotland," GLO Discussion Paper Series 868, Global Labor Organization (GLO).
    8. Burdett, Ashley & Etheridge, Ben & Tang, Li & Wang, Yikai, 2024. "Worker productivity during Covid-19 and adaptation to working from home," European Economic Review, Elsevier, vol. 167(C).
    9. Morrissey, Karyn & Spooner, Fiona & Salter, James & Shaddick, Gavin, 2021. "Area level deprivation and monthly COVID-19 cases: The impact of government policy in England," Social Science & Medicine, Elsevier, vol. 289(C).
    10. Islam, Marco, 2021. "Motivated Risk Assessments," Working Papers 2021:12, Lund University, Department of Economics, revised 26 Jul 2022.
    11. Nicolás González-Pampillón & Gonzalo Nunez-Chaim & Katharina Ziegler, 2021. "Recovering from the first Covid-19 lockdown: Economic impacts of the UK's Eat Out to Help Out scheme," CEP Covid-19 Analyses cepcovid-19-018, Centre for Economic Performance, LSE.
    12. Deiana, Claudio & Geraci, Andrea & Mazzarella, Gianluca & Sabatini, Fabio, 2021. "COVID-19 Relief Programs and Compliance with Confinement Measures," IZA Discussion Papers 14064, Institute of Labor Economics (IZA).
    13. Deiana, Claudio & Geraci, Andrea & Mazzarella, Gianluca & Sabatini, Fabio, 2022. "Can relief measures nudge compliance in a public health crisis? Evidence from a kinked fiscal policy rule," Journal of Economic Behavior & Organization, Elsevier, vol. 202(C), pages 407-428.
    14. Lukasz Rachel, 2025. "The second wave," Review of Economic Design, Springer;Society for Economic Design, vol. 29(1), pages 87-113, February.
    15. Fischer Kai, 2022. "Thinning out spectators: Did football matches contribute to the second COVID-19 wave in Germany?," German Economic Review, De Gruyter, vol. 23(4), pages 595-640, December.
    16. Solórzano Diego, 2023. "Grab a Bite? Prices in the food away from home industry during the COVID-19 pandemic," Working Papers 2023-18, Banco de México.
    17. Nils Braakmann & Boris Hirsch, 2024. "Unions as insurance: Workplace unionization and workers' outcomes during COVID‐19," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 63(2), pages 152-171, April.
    18. Solórzano, Diego, 2024. "Grab a bite? Prices in the food away from home industry during the COVID-19 pandemic," Journal of Economic Behavior & Organization, Elsevier, vol. 225(C), pages 435-464.
    19. Paravee Maneejuk & Panuwat Sukinta & Jiraphat Chinkarn & Woraphon Yamaka, 2024. "Does the resumption of international tourism heighten COVID-19 transmission?," PLOS ONE, Public Library of Science, vol. 19(2), pages 1-25, February.

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