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Subnational income, growth, and the COVID-19 pandemic

Author

Listed:
  • Choudhary, M. Ali
  • Dal Barco, Ilaria
  • Haqqani, Ijlal A.
  • Lenzi, Federico
  • Limodio, Nicola

Abstract

Using real-time data and machine-learning methods, we produce monthly aggregates on gross national income (GNI) for 147 Pakistani districts between 2012 and 2021. We use them to understand whether and how the COVID-19 pandemic affected the growth and subnational distribution of income in Pakistan. Three findings emerge from our analysis. First, districts experienced a sizable decline in income during the pandemic, as their monthly growth rate dropped on average by 0.133 percentage points. Second, a larger income drop took place in districts with a higher COVID-19 incidence, which correspond to urban areas characterized by a higher population density. Third, COVID-19 caused a decline in income inequality across districts, with richer districts experiencing more negative income growth during the pandemic.

Suggested Citation

  • Choudhary, M. Ali & Dal Barco, Ilaria & Haqqani, Ijlal A. & Lenzi, Federico & Limodio, Nicola, 2025. "Subnational income, growth, and the COVID-19 pandemic," LSE Research Online Documents on Economics 128131, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:128131
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    References listed on IDEAS

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    1. M Ali Choudhary & Nicola Limodio, 2022. "Liquidity Risk and Long-Term Finance: Evidence from a Natural Experiment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 89(3), pages 1278-1313.
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    3. Beyer, Robert C.M. & Franco-Bedoya, Sebastian & Galdo, Virgilio, 2021. "Examining the economic impact of COVID-19 in India through daily electricity consumption and nighttime light intensity," World Development, Elsevier, vol. 140(C).
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    5. Nicola Limodio, 2021. "Bureaucrat Allocation in the Public Sector: Evidence from the World Bank," The Economic Journal, Royal Economic Society, vol. 131(639), pages 3012-3040.
    6. Titan Alon & Minki Kim & David Lagakos & Mitchell VanVuren, 2020. "How Should Policy Responses to the COVID-19 Pandemic Differ in the Developing World?," NBER Working Papers 27273, National Bureau of Economic Research, Inc.
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    Full references (including those not matched with items on IDEAS)

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    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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