The Effect of COVID-19 Lockdown and the Subsequent Re-Opening on Consumption in Iran

35 Pages Posted: 5 Aug 2020 Last revised: 8 Jan 2021

See all articles by Mohammad Hoseini

Mohammad Hoseini

Tilburg University - Center for Economic Research (CentER); Institute for Management and Planning Studies (IMPS); Tilburg University - European Banking Center

Abolmohsen Valizadeh

Institute for Management and Planning Studies

Date Written: July 30, 2020

Abstract

We use country-wide data on all electronic payments in point-of-sale (POS) and online terminals of Iran to study the change in the pattern of consumption and online-offline substitution during the COVID-19 lockdown and after the relaxation of restrictions in May and June. Using a difference-in-difference approach, we find that during the strictest lockdown month, growth in value of transactions dropped by 41% compared to the benchmark month before the pandemic. After lifting the lockdown, the growth rose by 12% above the benchmark month. We also find that the COVID-19 pandemic led to a spike in online transactions of activities with online terminals and has had a persistent effect on consumer preference for online shopping even after the reopening of the economy.

Keywords: COVID-19, consumption, online purchasing, transaction data, Iran

JEL Classification: D12, E21

Suggested Citation

Hoseini, Mohammad and Hoseini, Mohammad and Valizadeh, Abolmohsen, The Effect of COVID-19 Lockdown and the Subsequent Re-Opening on Consumption in Iran (July 30, 2020). Available at SSRN: https://ssrn.com/abstract=3662980 or http://dx.doi.org/10.2139/ssrn.3662980

Mohammad Hoseini (Contact Author)

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Institute for Management and Planning Studies (IMPS) ( email )

North Niavaran Street
Tehran
Iran

HOME PAGE: http://imps.ac.ir/index.aspx?fkeyid=&siteid=1&pageid=2624

Tilburg University - European Banking Center ( email )

PO Box 90153
Tilburg, 5000 LE
Netherlands

Abolmohsen Valizadeh

Institute for Management and Planning Studies ( email )

North Niavaran Street
Tehran
Iran

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