Covid Economics - Issue 82

In this paper, I describe the restaurant business closure patterns in the year 2020. I use Yelp data collected first in late 2019 and then in early 2021 to study restaurant and location characteristics related to the exit decisions. I find that higher rated restaurants as well as restaurants located further away from central city areas were less likely to close during 2020.

As a result of the COVID-19 pandemic schools closed abruptly in March 2020 and Colorado issued a stay-at-home order during the month of April. Subsequently, child maltreatment reporting dropped by 31 percent. This paper documents the decline in referrals and reports during the year in Colorado and predicts counterfactual estimates using two strategies. One strategy assumes the underlying behavior for child maltreatment was unchanged from 2019 to 2020. This approach implies that about 30,000 referrals went unreported over the year as a result of the pandemic. The second strategy assumes the economic distress brought about by the pandemic altered the underlying prevalence of child maltreatment. In this case, over 38,800 cases of child maltreatment might have gone undetected. Scaling these results to the national level suggests millions of child maltreatment referrals went unreported. I find that the largest reduction in reporting comes from the stay-at-home order, followed by school closings. Moreover, there is suggestive evidence that these missed children are suffering from neglect and not abuse. These findings quantify another hardship brought about by the pandemic, underreporting, and underscore the role mandatory reporters play in detecting child maltreatment.

This paper assesses the impact of the pandemic crisis on self-employed income among artists resident in Germany. Using unique data from the latest available public insurance records, we show that musicians and performing artists are among the most vulnerable groups, and that writers, on average, are relatively less impacted. Moreover, the paper looks at the impact of the 2020 crisis on income differences by gender, career stages and regions, and it investigates the effect of specific non-pharmaceutical, public intervention implemented in German states.

The COVID-19 pandemic-driven economic downturn can have substantial implications for the gender gap in the labor market in developing countries, where women are already worse-off in job participation and earnings than men. Using multiple rounds of individual-level survey data before and after the pandemic and incorporating a difference-in-differences design, we show that overall employment has reduced more for women than men in Nigeria. Women also experienced a larger shift from business employment to farm-based employments. Thus, in addition to causing longer-term unemployment for women, the COVID-19 pandemic may further aggravate women’s economic condition to the extent the labor market returns in farming activities are lower than that of business activities.

This paper demonstrates how changes to welfare generosity during recessions induces a greater than usual economic response. This is predicated on the assumption that welfare recipients are likely to be liquidity-constrained and therefore highly responsive to a change in temporary income. This would result in two conclusions, (i) the effects of fiscal stimulus can be maximised when channelled through welfare and (ii) fiscal consolidation from these programs will have a strong contractionary effect on domestic output. Using the tax-benefit microsimulation model UKMOD, we find 71% of means-tested welfare recipients are liquidity-constrained. We use this finding to calibrate an open-economy New Keynesian macroeconomic model to therefore illustrate the economic implications of positive changes to the program’s generosity, finding an impact fiscal multiplier of 1.5. For cuts to contributions, we find a negative multiplier of 1.8, implying past cuts to welfare had a sizeable contractionary effect on macroeconomic recovery.