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Sweden's COVID-19 Recession: How Foreign and Domestic Infections Struck against Firms and Workers

Author

Listed:
  • Akerman, Anders

    (Stockholm University)

  • Ekholm, Karolina

    (Stockholm University)

  • Persson, Torsten

  • Nordström Skans, Oskar

    (Uppsala University)

Abstract

Using highly granular micro data, we document very divergent economic effects of the COVID-19 pandemic on Swedish private-sector firms and their workers. Firms that exported to, or imported from, heavily afflicted countries reduced their output due to disrupted trade. Service firms that operated in locations with many infections reduced their output due to falling local consumption, despite very limited regional restrictions. Workers at the bottom of each social gradient – defined by education, earnings or ethnicity – took a twofold hit: their employers faced the largest output drops and they experienced the largest transmissions from firm output to earnings.

Suggested Citation

  • Akerman, Anders & Ekholm, Karolina & Persson, Torsten & Nordström Skans, Oskar, 2022. "Sweden's COVID-19 Recession: How Foreign and Domestic Infections Struck against Firms and Workers," IZA Discussion Papers 15408, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp15408
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    References listed on IDEAS

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    1. Andrew Atkeson, 2020. "What Will be the Economic Impact of COVID-19 in the US? Rough Estimates of Disease Scenarios," Staff Report 595, Federal Reserve Bank of Minneapolis.
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    Cited by:

    1. Fenella Carpena & Laurens Swinkels & Dan Zhang, 2024. "The effects of COVID‐19 policies on consumer spending in Norway," Contemporary Economic Policy, Western Economic Association International, vol. 42(1), pages 56-67, January.

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    Keywords

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    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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