Evaluating the Effectiveness of Policies Against a Pandemic

36 Pages Posted: 19 Oct 2020 Last revised: 12 Nov 2020

See all articles by Christian Aleman

Christian Aleman

Autonomous University of Barcelona; Barcelona Graduate School of Economics (Barcelona GSE)

Christopher Busch

Autonomous University of Barcelona - MOVE (Markets, Organizations and Votes in Economics); Barcelona Graduate School of Economics (Barcelona GSE)

Alexander Ludwig

Goethe University Frankfurt

Raül Santaeulàlia-Llopis

UAB and Barcelona GSE

Multiple version iconThere are 4 versions of this paper

Date Written: November 11, 2020

Abstract

We develop a novel empirical approach to identify the effectiveness of policies against a pandemic. The essence of our approach is the insight that epidemic dynamics are best tracked over stages, rather than over time. We use a normalization procedure that makes the pre-policy paths of the epidemic identical across regions. The procedure uncovers regional variation in the stage of the epidemic at the time of policy implementation. This variation delivers clean identification of the policy effect based on the epidemic path of a leading region that serves as a counterfactual for other regions. We apply our method to evaluate the effectiveness of the nationwide stay-home policy enacted in Spain against the Covid-19 pandemic. We find that the policy saved 15.9% of lives relative to the number of deaths that would have occurred had it not been for the policy intervention. Its effectiveness evolves with the epidemic and is larger when implemented at earlier stages.

Keywords: Macroeconomics, Pandemic, Stages, Covid-19, Stay-Home, Policy Effects, Identification

JEL Classification: E01, E22, E25

Suggested Citation

Aleman, Christian and Busch, Christopher and Ludwig, Alexander and Santaeulalia-Llopis, Raul, Evaluating the Effectiveness of Policies Against a Pandemic (November 11, 2020). SAFE Working Paper No. 294, Available at SSRN: https://ssrn.com/abstract=3714697 or http://dx.doi.org/10.2139/ssrn.3714697

Christian Aleman

Autonomous University of Barcelona ( email )

Plaça Cívica
Cerdañola del Valles
Barcelona, Barcelona 08193
Spain

Barcelona Graduate School of Economics (Barcelona GSE) ( email )

Ramon Trias Fargas, 25-27
Barcelona, Barcelona 08005
Spain

Christopher Busch

Autonomous University of Barcelona - MOVE (Markets, Organizations and Votes in Economics) ( email )

Campus de Bellaterra-UAB Edifici B (s/n)
EDIFICI B
Cerdanyola del Vallès
, Barcelona 08193
Spain

Barcelona Graduate School of Economics (Barcelona GSE) ( email )

Ramon Trias Fargas, 25-27
Barcelona, Barcelona 08005
Spain

Alexander Ludwig (Contact Author)

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

Raul Santaeulalia-Llopis

UAB and Barcelona GSE ( email )

Plaza Civica, s/n
Bellaterra, Barcelona 08193
Spain

HOME PAGE: http://r-santaeulalia.net

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