IDEAS home Printed from https://ideas.repec.org/p/mtl/montec/18-2020.html
   My bibliography  Save this paper

Lockdown Accounting

Author

Listed:
  • Charles Gottlieb

    (University of St. Gallen)

  • Jan Grobovsek

    (University of Edinburgh)

  • Markus Poschke

    (McGill University)

  • Fernando Saltiel

    (McGill University)

Abstract

We use an accounting framework to evaluate the aggregate impact of a common lockdown policy for 85 countries. We find that poorer countries devote more labor to essential activities that are unaffected by the lockdown, while richer countries can more easily substitute non-essential employment with work from home. The lockdown generates an employment response that is U-shaped in income: it drops by 32% in the poorest quintile of the distribution, by 36% in the middle quintile, and by 31% in the richest quintile. Annualized GDP declines by 39% in the bottom three quintiles and by 31% in the richest quintile. Agriculture, an essential sector, is key in sustaining employment and economic activity in poorer countries.

Suggested Citation

  • Charles Gottlieb & Jan Grobovsek & Markus Poschke & Fernando Saltiel, 2020. "Lockdown Accounting," Cahiers de recherche 18-2020, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
    • Handle: RePEc:mtl:montec:18-2020
    as

    Download full text from publisher

    File URL: http://www.cireqmontreal.com/wp-content/uploads/cahiers/18-2020-cah.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Adams-Prassl, A. & Boneva, T. & Golin, M. & Rauh, C., 2020. "Work Tasks That Can Be Done From Home: Evidence on Variation Within and Across Occupations and Industries," Cambridge Working Papers in Economics 2040, Faculty of Economics, University of Cambridge.
    2. Restuccia, Diego & Yang, Dennis Tao & Zhu, Xiaodong, 2008. "Agriculture and aggregate productivity: A quantitative cross-country analysis," Journal of Monetary Economics, Elsevier, vol. 55(2), pages 234-250, March.
    3. Aum, Sangmin & Lee, Sang Yoon (Tim) & Shin, Yongseok, 2021. "Inequality of fear and self-quarantine: Is there a trade-off between GDP and public health?," Journal of Public Economics, Elsevier, vol. 194(C).
    4. Berthold Herrendorf & Todd Schoellman, 2015. "Why is Measured Productivity so Low in Agriculture?," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(4), pages 1003-1022, October.
    5. Dingel, Jonathan I. & Neiman, Brent, 2020. "How many jobs can be done at home?," Journal of Public Economics, Elsevier, vol. 189(C).
    6. Alexander Bick & Adam Blandin & Karel Mertens, 2023. "Work from Home before and after the COVID-19 Outbreak," American Economic Journal: Macroeconomics, American Economic Association, vol. 15(4), pages 1-39, October.
    7. Hensvik, Lena & Le Barbanchon, Thomas & Rathelot, Roland, 2020. "Which jobs are done from home? Evidence from the American Time Use Survey?," The Warwick Economics Research Paper Series (TWERPS) 1261, University of Warwick, Department of Economics.
    8. David Baqaee & Emmanuel Farhi, 2022. "Supply and Demand in Disaggregated Keynesian Economies with an Application to the COVID-19 Crisis," American Economic Review, American Economic Association, vol. 112(5), pages 1397-1436, May.
    9. Daniel Garrote Sanchez & Nicolas Gomez Parra & Caglar Ozden & Bob Rijkers & Mariana Viollaz & Hernan Winkler, 2021. "Who on Earth Can Work from Home? [Secular Stagnation? The Effect of Aging on Economic Growth in the Age of Automation]," The World Bank Research Observer, World Bank, vol. 36(1), pages 67-100.
    10. Luiz Brotherhood & Philipp Kircher & Cezar Santos & Michèle Tertilt, 2020. "An Economic Model of the Covid-19 Epidemic: The Importance of Testing and Age-Specific Policies," CESifo Working Paper Series 8316, CESifo.
    11. Fernando E. Alvarez & David Argente & Francesco Lippi, 2020. "A Simple Planning Problem for COVID-19 Lockdown," NBER Working Papers 26981, National Bureau of Economic Research, Inc.
    12. Harald Fadinger & Jan Schymik, 2020. "The Effects of Working From Home on COVID-19 Infections and Production - A Macroeconomic Analysis for Germany," CRC TR 224 Discussion Paper Series crctr224_2020_167, University of Bonn and University of Mannheim, Germany.
    13. Maho Hatayama & Mariana Viollaz & Hernan Winkler, 2020. "Jobs’ Amenability to Working from Home: Evidence from Skills Surveys for 53 Countries," CEDLAS, Working Papers 0263, CEDLAS, Universidad Nacional de La Plata.
    14. Adams-Prassl, Abigail & Boneva, Teodora & Rauh, Christopher & Golin, Marta, 2020. "Work Tasks That Can Be Done From Home: Evidence on Variation Within & Across Occupations and Industries," CEPR Discussion Papers 14901, C.E.P.R. Discussion Papers.
    15. Veronica Guerrieri & Guido Lorenzoni & Ludwig Straub & Iván Werning, 2022. "Macroeconomic Implications of COVID-19: Can Negative Supply Shocks Cause Demand Shortages?," American Economic Review, American Economic Association, vol. 112(5), pages 1437-1474, May.
    16. Herrendorf, Berthold & Rogerson, Richard & Valentinyi, Ákos, 2014. "Growth and Structural Transformation," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 6, pages 855-941, Elsevier.
    17. Gollin, Douglas, 2008. "Nobody's business but my own: Self-employment and small enterprise in economic development," Journal of Monetary Economics, Elsevier, vol. 55(2), pages 219-233, March.
    18. Titan Alon & Minki Kim & David Lagakos, 2020. "How Should Policy Responses to the COVID-19 Pandemic Differ in the Developing World?," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-350, Boston University - Department of Economics.
    19. Adams-Prassl, Abi & Boneva, Teodora & Golin, Marta & Rauh, Christopher, 2022. "Work that can be done from home: evidence on variation within and across occupations and industries," Labour Economics, Elsevier, vol. 74(C).
    20. Callum Jones & Thomas Philippon & Venky Venkateswaran, 2021. "Optimal Mitigation Policies in a Pandemic: Social Distancing and Working from Home [A simple planning problem for covid-19 lockdown]," The Review of Financial Studies, Society for Financial Studies, vol. 34(11), pages 5188-5223.
    21. Brotherhood, Luiz & Kircher, Philipp & Santos, Cezar & Tertilt, Michèle, 2020. "An economic model of the Covid-19 epidemic: The importance of testing and age-specific policies," CEPR Discussion Papers 14695, C.E.P.R. Discussion Papers.
    22. R Maria del Rio-Chanona & Penny Mealy & Anton Pichler & François Lafond & J Doyne Farmer, 2020. "Supply and demand shocks in the COVID-19 pandemic: an industry and occupation perspective," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 36(Supplemen), pages 94-137.
    23. Daniel Garrote Sanchez & Nicolas Gomez Parra & Caglar Ozden & Bob Rijkers & Mariana Viollaz & Hernan Winkler, 0. "Who on Earth Can Work from Home?," World Bank Research Observer, World Bank Group, vol. 36(1), pages 67-100.
    24. Brotherhood, Luiz & Kircher, Philipp & Santos, Cezar & Tertilt, Michèle, 2020. "An economic model of the Covid-19 epidemic: The importance of testing and age-specific policies," CEPR Discussion Papers 14695, C.E.P.R. Discussion Papers.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sangmin Aum & Sang Yoon (Tim) Lee & Yongseok Shin, 2022. "Who Should Work from Home During a Pandemic? The Wage-Infection Trade-off," Review, Federal Reserve Bank of St. Louis, vol. 104(2), pages 92-109.
    2. Leonardo Fabio Morales & Leonardo Bonilla‐Mejía & Jose Pulido & Luz A. Flórez & Didier Hermida & Karen L. Pulido‐Mahecha & Francisco Lasso‐Valderrama, 2022. "Effects of the COVID‐19 pandemic on the Colombian labour market: Disentangling the effect of sector‐specific mobility restrictions," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(S1), pages 308-357, February.
    3. Sebnem Kalemli-Ozcan & Pierre-Olivier Gourinchas & Veronika Penciakova & Nick Sander, 2020. "COVID-19 and SME Failures," IMF Working Papers 2020/207, International Monetary Fund.
    4. Pierre-Olivier Gourinchas & Ṣebnem Kalemli-Özcan & Veronika Penciakova & Nick Sander, 2021. "Fiscal Policy in the Age of COVID: Does it ‘Get in all of the Cracks?’," NBER Working Papers 29293, National Bureau of Economic Research, Inc.
    5. Mateusz Filipski & Anubhab Gupta & Justin Kagin & Arif Husain & Alejandro Grinspun & Oscar Maria Caccavale & Silvio Daidone & Valerio Giuffrida & Friederike Greb & Joseph Hooker & Susanna Sandström & , 2022. "A local general‐equilibrium emergency response modeling approach for sub‐Saharan Africa," Agricultural Economics, International Association of Agricultural Economists, vol. 53(1), pages 72-89, January.
    6. Nelson, Michael A., 2021. "The timing and aggressiveness of early government response to COVID-19: Political systems, societal culture, and more," World Development, Elsevier, vol. 146(C).
    7. Cecilia Peluffo & Mariana Viollaz, 2021. "Intra-household exposure to labor market risk in the time of Covid-19: lessons from Mexico," Review of Economics of the Household, Springer, vol. 19(2), pages 327-351, June.
    8. Antonio Estache & Simon Tooth, 2020. "On the scope for work-from-home in high and upper middle-income countries," Working Papers ECARES 2020-46, ULB -- Universite Libre de Bruxelles.
    9. Blagica Petreski & Marjan Petreski & Bojan Srbinoski, 2020. "The potential of export-oriented companies to contribute to post-Covid-19 economic recovery in North Macedonia," Finance Think Policy Studies 2020-12/33, Finance Think - Economic Research and Policy Institute.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gottlieb, Charles & Grobovšek, Jan & Poschke, Markus & Saltiel, Fernando, 2021. "Working from home in developing countries," European Economic Review, Elsevier, vol. 133(C).
    2. Sangmin Aum & Sang Yoon (Tim) Lee & Yongseok Shin, 2022. "Who Should Work from Home During a Pandemic? The Wage-Infection Trade-off," Review, Federal Reserve Bank of St. Louis, vol. 104(2), pages 92-109.
    3. David E. Bloom & Michael Kuhn & Klaus Prettner, 2022. "Modern Infectious Diseases: Macroeconomic Impacts and Policy Responses," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 85-131, March.
    4. Masayuki Morikawa, 2022. "Work‐from‐home productivity during the COVID‐19 pandemic: Evidence from Japan," Economic Inquiry, Western Economic Association International, vol. 60(2), pages 508-527, April.
    5. Alipour, Jean-Victor & Fadinger, Harald & Schymik, Jan, 2021. "My home is my castle – The benefits of working from home during a pandemic crisis," Journal of Public Economics, Elsevier, vol. 196(C).
    6. Bonadio, Barthélémy & Huo, Zhen & Levchenko, Andrei A. & Pandalai-Nayar, Nitya, 2021. "Global supply chains in the pandemic," Journal of International Economics, Elsevier, vol. 133(C).
    7. Bamieh, Omar & Ziegler, Lennart, 2022. "Are remote work options the new standard? Evidence from vacancy postings during the COVID-19 crisis," Labour Economics, Elsevier, vol. 76(C).
    8. Aditya Goenka & Lin Liu & Manh-Hung Nguyen, 2021. "Modeling optimal quarantines with waning immunity," Discussion Papers 21-10, Department of Economics, University of Birmingham.
    9. Greg Kaplan & Benjamin Moll & Giovanni L. Violante, 2020. "The Great Lockdown and the Big Stimulus: Tracing the Pandemic Possibility Frontier for the U.S," NBER Working Papers 27794, National Bureau of Economic Research, Inc.
    10. 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.
    11. Aditya Goenka & Lin Liu & Manh-Hung Nguyen, 2020. "Modeling optimal quarantines under infectious disease related mortality," Working Papers 202025, University of Liverpool, Department of Economics.
    12. Daniel Garrote Sanchez & Nicolas Gomez Parra & Caglar Ozden & Bob Rijkers & Mariana Viollaz & Hernan Winkler, 2021. "Who on Earth Can Work from Home? [Secular Stagnation? The Effect of Aging on Economic Growth in the Age of Automation]," The World Bank Research Observer, World Bank, vol. 36(1), pages 67-100.
    13. Timo Boppart & Karl Harmenberg & John Hassler & Per Krusell & Jonna Olsson, 2020. "Integrated Epi-Econ Assessment," NBER Working Papers 28282, National Bureau of Economic Research, Inc.
    14. Dizioli, Allan & Pinheiro, Roberto, 2021. "Information and inequality in the time of a pandemic," Journal of Economic Dynamics and Control, Elsevier, vol. 130(C).
    15. Garriga, Carlos & Manuelli, Rody & Sanghi, Siddhartha, 2022. "Optimal management of an epidemic: Lockdown, vaccine and value of life," Journal of Economic Dynamics and Control, Elsevier, vol. 140(C).
    16. Çakmaklı, Cem & Demiralp, Selva & Özcan, Şebnem Kalemli & Yeşiltaş, Sevcan & Yıldırım, Muhammed A., 2023. "COVID-19 and emerging markets: A SIR model, demand shocks and capital flows," Journal of International Economics, Elsevier, vol. 145(C).
    17. Mitman, Kurt & Hanley, Douglas & Bognanni, Mark & Kolliner, Daniel, 2020. "Economics and Epidemics: Evidence from an Estimated Spatial Econ-SIR Model," CEPR Discussion Papers 15310, C.E.P.R. Discussion Papers.
    18. Michael Gibbs & Friederike Mengel & Christoph Siemroth, 2023. "Work from Home and Productivity: Evidence from Personnel and Analytics Data on Information Technology Professionals," Journal of Political Economy Microeconomics, University of Chicago Press, vol. 1(1), pages 7-41.
    19. Okubo, Toshihiro, 2022. "Telework in the spread of COVID-19," Information Economics and Policy, Elsevier, vol. 60(C).
    20. Abel Brodeur & David Gray & Anik Islam & Suraiya Bhuiyan, 2021. "A literature review of the economics of COVID‐19," Journal of Economic Surveys, Wiley Blackwell, vol. 35(4), pages 1007-1044, September.

    More about this item

    Keywords

    Covid-19; structural change; work from home; lockdown;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mtl:montec:18-2020. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sharon BREWER (email available below). General contact details of provider: https://edirc.repec.org/data/cdmtlca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.