The Price of the Lockdown – The Effects of Social Distancing on the Indian Economy and Business During the COVID-19 Pandemic

Baber, H., & Tripati, R. D. (2021). The price of the lockdown: The effects of social distancing on the Indian economy and business during the COVID-19 pandemic. Ekonomski horizonti, 23(1), 85-99.

13 Pages Posted: 24 Feb 2021 Last revised: 24 Aug 2021

See all articles by Hasnan Baber

Hasnan Baber

Woosong University; Abu Dhabi School of Management

D. Tripati Rao

IIM Lucknow

Multiple version iconThere are 2 versions of this paper

Date Written: February 23, 2021

Abstract

The decision of an immediate lockdown in India had put economic, social and religious activities to a grinding halt. The paper examines the impact of lockdown and social distancing policies on economic activities in India using a multivariate econometric model of the data collected for the period of 1st January to 31st August 2020. While social distancing policies are captured in terms of restrictions on internal movement, domestic travel and international travel, its effect on economic and business activity is captured through stock prices, purchasing managers index and exchange rate. Confirmed COVID-19 cases and related deaths are also used as independent variables. The results reveal a significant negative impact of social distancing policies on the economic and business activity, stock market and exchange rate. Further, the economic stimulus provided by the government could not bring a positive influence on the stock market.

Keywords: Lockdown, Economy, Financial, COVID-19, Social Distancing, India

JEL Classification: E65, E62

Suggested Citation

Baber, Hasnan and Rao, D. Tripati, The Price of the Lockdown – The Effects of Social Distancing on the Indian Economy and Business During the COVID-19 Pandemic (February 23, 2021). Baber, H., & Tripati, R. D. (2021). The price of the lockdown: The effects of social distancing on the Indian economy and business during the COVID-19 pandemic. Ekonomski horizonti, 23(1), 85-99., Available at SSRN: https://ssrn.com/abstract=3791055

Hasnan Baber (Contact Author)

Woosong University ( email )

27 Baengnyong-ro 57beon-gil
Jayang-dong, Daejeon
Korea, Republic of (South Korea)

Abu Dhabi School of Management ( email )

Abu Dhabi
United Arab Emirates

D. Tripati Rao

IIM Lucknow ( email )

Prabandh Nagar, IIM road
Lucknow, UT 226013
India

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