The English Patient: Evaluating Local Lockdowns Using Real-Time COVID-19 & Consumption Data

Covid Economics 64: 73-100 (2021)

28 Pages Posted: 8 Mar 2021

See all articles by John Gathergood

John Gathergood

University of Nottingham - School of Economics

Benedict Guttman-Kenney

University of Chicago - Booth School of Business

Date Written: January 13, 2021

Abstract

We find UK “local lockdowns” of cities and small regions, focused on limiting how many people a household can interact with and in what settings, are effective in turning the tide on rising positive COVID-19 cases. Yet, by focusing on household mixing within the home, these local lockdowns have not inflicted the large declines in consumption observed in March 2020 when the first virus wave and first national lockdown occurred. Our study harnesses a new source of real-time, transaction-level consumption data that we show to be highly correlated with official statistics. The effectiveness of local lockdowns are evaluated applying a difference-in-difference approach which exploits nearby localities not subject to local lockdowns as comparison groups. Our findings indicate that policymakers may be able to contain virus outbreaks without killing local economies. However, the ultimate effectiveness of local lockdowns is expected to be highly dependent on co-ordination between regions and an effective system of testing.

Keywords: Consumption, Coronavirus, COVID-19, Household Finance, Local Lockdowns, Credit Cards

JEL Classification: D14, E21, E61, E65, G51, H12, H75

Suggested Citation

Gathergood, John and Guttman-Kenney, Benedict, The English Patient: Evaluating Local Lockdowns Using Real-Time COVID-19 & Consumption Data (January 13, 2021). Covid Economics 64: 73-100 (2021), Available at SSRN: https://ssrn.com/abstract=3798666 or http://dx.doi.org/10.2139/ssrn.3798666

John Gathergood

University of Nottingham - School of Economics ( email )

Sir Clive Granger Building
University Park
Nottingham, NG7 2RD
United Kingdom

HOME PAGE: http://https://sites.google.com/site/gathergoodjohn/

Benedict Guttman-Kenney (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

HOME PAGE: http://www.benedictgk.com

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