Small Business under the COVID-19 Crisis: Expected Short- and Medium-Run Effects of Anti-Contagion and Economic Policies

82 Pages Posted: 25 Jun 2020 Last revised: 10 Sep 2020

See all articles by Kohei Kawaguchi

Kohei Kawaguchi

Hong Kong University of Science and Technology

Naomi Kodama

Nihon University

Mari Tanaka

Hitotsubashi University, Graduate School of Economics

Date Written: September 10, 2020

Abstract

This study evaluates anti-contagion and economic policies by conducting a survey on Japanese small business managers' expectations about the pandemic, policies, and firm performance. First, the business suspension request decreased targeted firms' sales by 10 percentage points on top of the baseline 8 percentage points decline due to COVID-19. Second, lump-sum subsidies improved firms' prospects of survival by 19 percentage points. Third, the medium-run recovery of the firms' performance is expected to depend crucially on when infections would end and whether the Tokyo Olympic Games could be held. The results indicate that stringent anti-contagion policies could complement longer-run economic goals.

Keywords: COVID-19, Pandemic, Infection, Anti-contagion policies, Lockdown, Subsidy, Small business, Manager's expectation, Business performance, Survey, Causal inference

JEL Classification: C83, D80, D84, E17, E32, E66, I18, L50

Suggested Citation

Kawaguchi, Kohei and Kodama, Naomi and Tanaka, Mari, Small Business under the COVID-19 Crisis: Expected Short- and Medium-Run Effects of Anti-Contagion and Economic Policies (September 10, 2020). Available at SSRN: https://ssrn.com/abstract=3634544 or http://dx.doi.org/10.2139/ssrn.3634544

Kohei Kawaguchi (Contact Author)

Hong Kong University of Science and Technology ( email )

6070 LSK Building, HKUST
Clear Water Bay
Kowloon
Hong Kong

Naomi Kodama

Nihon University ( email )

Tokyo
Japan

Mari Tanaka

Hitotsubashi University, Graduate School of Economics ( email )

Naka 2-1
Kunitachi, Tokyo 186-8601
Japan

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
777
Abstract Views
3,157
rank
35,484
PlumX Metrics