Assessing and Addressing the Coronavirus-Induced Economic Crisis: Evidence From 1.5 Billion Sales Invoices
63 Pages Posted: 6 Aug 2020 Last revised: 15 Mar 2024
Date Written: February 29, 2024
Abstract
We probe the effects of the COVID-19 pandemic and the subsequent containment policies on business activities in China by exploiting 1.5 billion sales invoices. Using a difference-in-differences approach, we estimate that the average drop in sales is between 23% and 35%, depending on firm size, for the 12-week period after Wuhan’s lockdown. Firms in industries requiring more intensive face-to-face interactions suffer more. Also, cities relying on investment-driven economic growth are more resilient. Lastly, governments’ economic stimulus policies are more effective for medium-sized and large firms. Our findings shed new light on the policy debates on supporting business during the pandemic.
Keywords: COVID-19, pandemic, invoices, firm sales, economic stimulus
JEL Classification: G10, D22, H12
Suggested Citation: Suggested Citation