China and World Output Impact of the Hubei Lockdown During the Coronavirus Outbreak

Forthcoming, Contemporary Economic Policy

18 Pages Posted: 25 Feb 2020 Last revised: 30 Apr 2020

See all articles by Shaowen Luo

Shaowen Luo

Virginia Tech - Department of Economics

Kwok Ping Tsang

Virginia Tech

Date Written: April 24, 2020

Abstract

Using a network approach, we estimate the output loss due to the lockdown of the Hubei province triggered by the coronavirus disease (COVID-19). Based on our most conservative estimate, China suffers about 4% loss of output from labor loss, and global output drops by 1% due to the economic contraction in China. About 40% of the impact is indirect, coming from spillovers through the supply chain inside and outside China.

Keywords: coronavirus; COVID-19; production network; labor shock; China; international trade

JEL Classification: E23, E24, F62

Suggested Citation

Luo, Shaowen and Tsang, Kwok Ping, China and World Output Impact of the Hubei Lockdown During the Coronavirus Outbreak (April 24, 2020). Forthcoming, Contemporary Economic Policy, Available at SSRN: https://ssrn.com/abstract=3543760 or http://dx.doi.org/10.2139/ssrn.3543760

Shaowen Luo

Virginia Tech - Department of Economics ( email )

3021 Pamplin Hall
Blacksburg, VA 24061
United States

Kwok Ping Tsang (Contact Author)

Virginia Tech ( email )

250 Drillfield Drive
Blacksburg, VA 24061
United States

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