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Protecting Lives and Livelihoods with Early and Tight Lockdowns


  • Francesca Caselli
  • Mr. Francesco Grigoli
  • Weicheng Lian
  • Mr. Damiano Sandri


Using high-frequency proxies for economic activity over a large sample of countries, we show that the economic crisis during the first seven months of the COVID-19 pandemic was only partly due to government lockdowns. Economic activity also contracted because of voluntary social distancing in response to higher infections. We also show that lockdowns can substantially reduce COVID-19 infections, especially if they are introduced early in a country's epidemic. Despite involving short-term economic costs, lockdowns may thus pave the way to a faster recovery by containing the spread of the virus and reducing voluntary social distancing. Finally, we document that lockdowns entail decreasing marginal economic costs but increasing marginal benefits in reducing infections. This suggests that tight short-lived lockdowns are preferable to mild prolonged measures.

Suggested Citation

  • Francesca Caselli & Mr. Francesco Grigoli & Weicheng Lian & Mr. Damiano Sandri, 2020. "Protecting Lives and Livelihoods with Early and Tight Lockdowns," IMF Working Papers 2020/234, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:2020/234

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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. Fischer, Kai & Reade, J. James & Schmal, W. Benedikt, 2022. "What cannot be cured must be endured: The long-lasting effect of a COVID-19 infection on workplace productivity," Labour Economics, Elsevier, vol. 79(C).
    2. Regina Pleninger & Sina Streicher & Jan-Egbert Sturm, 2022. "Do COVID-19 containment measures work? Evidence from Switzerland," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 158(1), pages 1-24, December.
    3. Woraphon Yamaka & Siritaya Lomwanawong & Darin Magel & Paravee Maneejuk, 2022. "Analysis of the Lockdown Effects on the Economy, Environment, and COVID-19 Spread: Lesson Learnt from a Global Pandemic in 2020," IJERPH, MDPI, vol. 19(19), pages 1-21, October.
    4. Nuno Cassola & Paul De Grauwe & Claudio Morana & Patrizio Tirelli, 2021. "The risks of exiting too early the policy responses to the COVID-19 recession," Working Paper series 21-22, Rimini Centre for Economic Analysis.
    5. Famiglietti, Matthew & Leibovici, Fernando, 2022. "The impact of health and economic policies on the spread of COVID-19 and economic activity," European Economic Review, Elsevier, vol. 144(C).
    6. Fernandes, Mário Correia & Dutra, Tiago Mota & Dias, José Carlos & Teixeira, João C.A., 2023. "Modelling output gaps in the Euro Area with structural breaks: The COVID-19 recession," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 1046-1058.
    7. Laeven, Luc, 2022. "Pandemics, intermediate goods, and corporate valuation," Journal of International Money and Finance, Elsevier, vol. 120(C).
    8. Checo Ariadne & Grigoli Francesco & Mota Jose M., 2022. "Assessing Targeted Containment Policies to Fight COVID-19," The B.E. Journal of Macroeconomics, De Gruyter, vol. 22(1), pages 159-196, January.
    9. Amr Hosny & Kevin Pallara, 2023. "Economic Activity, Fiscal Space and Types of COVID-19 Containment Measures," Economics of Disasters and Climate Change, Springer, vol. 7(3), pages 319-355, November.
    10. David Turner & Balázs Égert & Yvan Guillemette & Jarmila Botev, 2021. "The tortoise and the hare: The race between vaccine rollout and new COVID variants," OECD Economics Department Working Papers 1672, OECD Publishing.
    11. Francesco Paolo Conteduca & Alessandro Borin, 2022. "A New Dataset for Local and National COVID-19-Related Restrictions in Italy," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 8(2), pages 435-470, July.
    12. Anand Chopra & Michael B. Devereux & Amartya Lahiri, 2022. "Pandemics through the lens of occupations," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(S1), pages 540-580, February.
    13. Vytautas Kuokštis & Ringailė Kuokštytė, 2023. "How Institutions Moderated the Pandemic's Economic Impact in EU Member States," Journal of Common Market Studies, Wiley Blackwell, vol. 61(2), pages 503-525, March.
    14. Glenn L. Furton, 2023. "The pox of politics: Troesken’s tradeoff reexamined," Public Choice, Springer, vol. 195(1), pages 169-191, April.
    15. Thomas Hale & Noam Angrist & Andrew J Hale & Beatriz Kira & Saptarshi Majumdar & Anna Petherick & Toby Phillips & Devi Sridhar & Robin N Thompson & Samuel Webster & Yuxi Zhang, 2021. "Government responses and COVID-19 deaths: Global evidence across multiple pandemic waves," PLOS ONE, Public Library of Science, vol. 16(7), pages 1-14, July.

    More about this item


    COVID-19; infections; lockdown; mobility; voluntary social distancing.; lockdown measure; lockdown stringency; lockdown tightening; lockdown restriction; sectors lockdown; job posting; effects of lockdown; Private savings; Economic recession; Unemployment rate; Global;
    All these keywords.

    JEL classification:

    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • I1 - Health, Education, and Welfare - - Health
    • H0 - Public Economics - - General

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