The Lockdown Effect: A Counterfactual for Sweden

35 Pages Posted: 20 May 2020 Last revised: 27 Jul 2020

See all articles by Benjamin Born

Benjamin Born

Frankfurt School of Finance & Management gemeinnützige GmbH

Alexander Dietrich

University of Tübingen

Gernot J. Müller

University of Tuebingen - Department of Economics

Date Written: May 2020

Abstract

We quantify the lockdown effect: the extent to which a lockdown limits the spread of COVID-19 infections. For this purpose we focus on Sweden---one of the few countries without a lockdown---and use synthetic control techniques to develop a counterfactual lockdown scenario. Based on a donor pool of European countries, we construct a control unit that behaves just like Sweden in terms of infection dynamics before it is put under lockdown for 8.5 weeks. The outcome in the control unit approximates the counterfactual lockdown scenario for Sweden. Three findings stand out. First, at the end of the lockdown period, COVID-19 infections and deaths in Sweden would have been reduced by one half and one third, respectively. Second, the lockdown effect starts to materialize with a delay of 3 to 4 weeks only. Third, we analyze Google mobility reports and find that actual mobility adjustments in Sweden are similar to those in the control unit---in both cases there is evidence for social distancing, but more so in the control unit.

Keywords: counterfactual, COVID-19, Google mobility reports, infections, lockdown, synthetic control unit, voluntary social restraint

JEL Classification: C4, F6, I18

Suggested Citation

Born, Benjamin and Dietrich, Alexander and Müller, Gernot J., The Lockdown Effect: A Counterfactual for Sweden (May 2020). CEPR Discussion Paper No. DP14744, Available at SSRN: https://ssrn.com/abstract=3603976

Benjamin Born (Contact Author)

Frankfurt School of Finance & Management gemeinnützige GmbH ( email )

Adickesallee 32-34
Frankfurt am Main, 60322
Germany

Alexander Dietrich

University of Tübingen ( email )

Germany

Gernot J. Müller

University of Tuebingen - Department of Economics ( email )

Mohlstrasse 36
D-72074 Tuebingen, 72074
Germany

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