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The effect of COVID-19 and emergency policies on Colombian households’ income

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  • Federico Corredor, Paola Ríos, David Rodríguez

Abstract

This paper studies the effects that the COVID-19 lockdown measures and the different emergency taxbenefit policies introduced by the authorities had on the household income distribution in Colombia. We measure the employment effects of the lockdown decree and use the tax-benefit microsimulation model for Colombia -COLMOD- to study the emergency policies for the first complete month of lockdown: April 2020. We found that 6.2 million of jobs are destroyed implying an average reduction of 16.5% of household income, with dramatic losses at the bottom of the distribution. The new policies introduced increased income by 0.8 billion pesos and offset the income loss of those in poverty but not of those slightly above the poverty line, this group could get on average only 84% of their previous income.

Suggested Citation

  • Federico Corredor, Paola Ríos, David Rodríguez, 2021. "The effect of COVID-19 and emergency policies on Colombian households’ income," Documentos de Trabajo UEC 19548, Universidad Externado de Colombia.
    • Handle: RePEc:col:000139:019548
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    References listed on IDEAS

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    4. Cristian Bonavida & Leonardo Gasparini, 2020. "El Impacto Asimétrico de la Cuarentena," CEDLAS, Working Papers 0261, CEDLAS, Universidad Nacional de La Plata.
    5. Doorley, Karina & Regan, Mark & Beirne, Keelan & Roantree, Barra & Tuda, Dora, 2020. "The potential costs and distributional effect of Covid-19 related unemployment in Ireland," EUROMOD Working Papers EM5/20, EUROMOD at the Institute for Social and Economic Research.
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    More about this item

    Keywords

    COVID-19; pandemic; poverty; income distribution; subsidies; microsimulation; Colombia;
    All these keywords.

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