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

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: 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