Tracking the Covid-19 Crisis with High-Resolution Transaction Data

52 Pages Posted: 8 May 2020 Last revised: 16 Aug 2020

See all articles by Vasco M. Carvalho

Vasco M. Carvalho

Universitat Pompeu Fabra/CREI; Centre for Economic Policy Research (CEPR); University of Cambridge

Stephen Hansen

Imperial College Business School

Álvaro Ortiz

affiliation not provided to SSRN

Juan Ramon Garcia

BBVA Research

Tomasa Rodrigo

BBVA Research – Ciudad BBVA

Sevi Rodriguez Mora

affiliation not provided to SSRN

Pep Ruiz de Aguirre

BBVA Research

Date Written: April 2020

Abstract

Financial and payments systems throughout the world generate a vast amount of naturally occurring, and digitally recorded, transaction data, but national statistical agencies mainly rely on surveys of much smaller scale for constructing official economic series. This paper considers 2.1 billion transactions from credit- and debit-card data from BBVA, the second largest bank in Spain, as an alternative source of information for measuring consumption, a key component of GDP. While card spending growth is more volatile than non-durable consumption growth, normalized spending correlates strongly with official consumption measures. In the cross section, patterns in card spending match those in official household budget surveys very closely. The implication is that card spending can stand in for consumption surveys in environments where official data is not available, for example due to reporting delays or to insufficient geographic or household detail. We apply the idea of card spending as a consumption survey to the COVID-19 crisis in Spain, where we present four findings: (1) a strong consumption reaction to lockdown and its easing at the national and regional levels; (2) a rapid, V-shaped consumption recovery in the aggregate; (3) an adjustment to the average consumption basket during lockdown towards the goods basket of low-income households; (4) a divergence in mobility patterns during lockdown according to income in which poorer households travel more during the workweek. Our main conclusion is that transaction data provides high-quality information about household consumption, which makes it a potentially important input into national statistics and research on household consumption.

Suggested Citation

Carvalho, Vasco M. and Hansen, Stephen and Ortiz, Álvaro and Garcia, Juan Ramon and Rodrigo, Tomasa and Rodriguez Mora, Sevi and Ruiz de Aguirre, Pep, Tracking the Covid-19 Crisis with High-Resolution Transaction Data (April 2020). CEPR Discussion Paper No. DP14642, Available at SSRN: https://ssrn.com/abstract=3594273

Vasco M. Carvalho (Contact Author)

Universitat Pompeu Fabra/CREI ( email )

Ramon Trias Fargas, 25-27
Barcelona, 08005
Spain

HOME PAGE: http://www.crei.cat/people/carvalho/welcome.html

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

University of Cambridge ( email )

Trinity Ln
Cambridge, CB2 1TN
United Kingdom

Stephen Hansen

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom

Álvaro Ortiz

affiliation not provided to SSRN

No Address Available

Juan Ramon Garcia

BBVA Research ( email )

2200 Post Oak Blvd
Houston, TX 77056
United States

Tomasa Rodrigo

BBVA Research – Ciudad BBVA ( email )

C/ Azul,4. Edificio La Vela. Planta 4
Madrid, 28050
Spain

Sevi Rodriguez Mora

affiliation not provided to SSRN

No Address Available

Pep Ruiz de Aguirre

BBVA Research ( email )

2200 Post Oak Blvd
Houston, TX 77056
United States

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