IDEAS home Printed from https://ideas.repec.org/a/bla/ecinqu/v60y2022i3p1437-1460.html
   My bibliography  Save this article

Consumer behavior and food prices during the COVID‐19 pandemic: Evidence from Chinese cities

Author

Listed:
  • Bixuan Yang
  • Frank Asche
  • Tao Li

Abstract

We find that Chinese consumers responded strongly to government restrictions during the COVID‐19 crisis. Our event‐study framework shows that emergency declarations raised average food prices by as much as 7.8 standard deviations of the price change distribution, with a much larger effect on non‐perishable vegetable prices (e.g., 17.0 standard deviations for Chinese cabbage prices). The effects of lockdowns were smaller but longer‐lasting. These results suggest that consumers panic bought non‐perishables under emergency declarations while under lockdowns there was a sustained increase in demand for non‐perishables. Such consumer behavior likely caused sizable losses in consumer welfare, especially among poor households.

Suggested Citation

  • Bixuan Yang & Frank Asche & Tao Li, 2022. "Consumer behavior and food prices during the COVID‐19 pandemic: Evidence from Chinese cities," Economic Inquiry, Western Economic Association International, vol. 60(3), pages 1437-1460, July.
    • Handle: RePEc:bla:ecinqu:v:60:y:2022:i:3:p:1437-1460
    DOI: 10.1111/ecin.13067
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ecin.13067
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ecin.13067?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Scott R Baker & Robert A Farrokhnia & Steffen Meyer & Michaela Pagel & Constantine Yannelis & Jeffrey Pontiff, 0. "How Does Household Spending Respond to an Epidemic? Consumption during the 2020 COVID-19 Pandemic," The Review of Asset Pricing Studies, Society for Financial Studies, vol. 10(4), pages 834-862.
    2. Goolsbee, Austan & Syverson, Chad, 2021. "Fear, lockdown, and diversion: Comparing drivers of pandemic economic decline 2020," Journal of Public Economics, Elsevier, vol. 193(C).
    3. Shuru Zhong & Mike Crang & Guojun Zeng, 2020. "Constructing freshness: the vitality of wet markets in urban China," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 37(1), pages 175-185, March.
    4. Kanika Mahajan & Shekhar Tomar, 2021. "COVID‐19 and Supply Chain Disruption: Evidence from Food Markets in India†," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(1), pages 35-52, January.
    5. Etienne Gagnon & David López-Salido, 2020. "Small Price Responses to Large Demand Shocks," Journal of the European Economic Association, European Economic Association, vol. 18(2), pages 792-828.
    6. Asger Lau Andersen & Emil Toft Hansen & Niels Johannesen & Adam Sheridan, 2022. "Consumer responses to the COVID‐19 crisis: evidence from bank account transaction data," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(4), pages 905-929, October.
    7. Stefano DellaVigna & Matthew Gentzkow, 2019. "Uniform Pricing in U.S. Retail Chains," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 134(4), pages 2011-2084.
    8. Erpeng Wang & Ning An & Zhifeng Gao & Emmanuel Kiprop & Xianhui Geng, 2020. "Consumer food stockpiling behavior and willingness to pay for food reserves in COVID-19," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 12(4), pages 739-747, August.
    9. Tian, Xu & Yu, Xiaohua, 2015. "Using semiparametric models to study nutrition improvement and dietary change with different indices: The case of China," Food Policy, Elsevier, vol. 53(C), pages 67-81.
    10. Sumedha Gupta & Thuy D. Nguyen & Felipe Lozano Rojas & Shyam Raman & Byungkyu Lee & Ana Bento & Kosali I. Simon & Coady Wing, 2020. "Tracking Public and Private Responses to the COVID-19 Epidemic: Evidence from State and Local Government Actions," NBER Working Papers 27027, National Bureau of Economic Research, Inc.
    11. Ihle, Rico & Rubin, Ofir D., 2013. "Consequences of unintended food policies: Food price dynamics subject to the Israeli–Palestinian conflict," Food Policy, Elsevier, vol. 42(C), pages 96-105.
    12. Jill E. Hobbs, 2020. "Food supply chains during the COVID‐19 pandemic," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(2), pages 171-176, June.
    13. Christopher J. Cronin & William N. Evans, 2020. "Private Precaution and Public Restrictions: What Drives Social Distancing and Industry Foot Traffic in the COVID-19 Era?," NBER Working Papers 27531, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sumedha Gupta & Kosali I. Simon & Coady Wing, 2020. "Mandated and Voluntary Social Distancing During The COVID-19 Epidemic: A Review," NBER Working Papers 28139, National Bureau of Economic Research, Inc.
    2. Diane Alexander & Ezra Karger, 2023. "Do Stay-at-Home Orders Cause People to Stay at Home? Effects of Stay-at-Home Orders on Consumer Behavior," The Review of Economics and Statistics, MIT Press, vol. 105(4), pages 1017-1027, July.
    3. John Gathergood & Fabian Gunzinger & Benedict Guttman-Kenney & Edika Quispe-Torreblanca & Neil Stewart, 2020. "Levelling Down and the COVID-19 Lockdowns: Uneven Regional Recovery in UK Consumer Spending," Papers 2012.09336, arXiv.org, revised Dec 2020.
    4. Jaravel, Xavier & O'Connell, Martin, 2020. "Real-time price indices: Inflation spike and falling product variety during the Great Lockdown," Journal of Public Economics, Elsevier, vol. 191(C).
    5. Andrew G. Atkeson & Karen A. Kopecky & Tao Zha, 2024. "Four Stylized Facts About Covid‐19," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 65(1), pages 3-42, February.
    6. Kong, Edward & Prinz, Daniel, 2020. "Disentangling policy effects using proxy data: Which shutdown policies affected unemployment during the COVID-19 pandemic?," Journal of Public Economics, Elsevier, vol. 189(C).
    7. Chen Zhu & Rigoberto A. Lopez & Yuan Gao & Xiaoou Liu, 2021. "The COVID‐19 Pandemic and Consumption of Food away from Home: Evidence from High‐frequency Restaurant Transaction Data," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 29(6), pages 73-94, November.
    8. Horvath, Akos & Kay, Benjamin & Wix, Carlo, 2023. "The COVID-19 shock and consumer credit: Evidence from credit card data," Journal of Banking & Finance, Elsevier, vol. 152(C).
    9. Engy Ziedan & Kosali I. Simon & Coady Wing, 2020. "Effects of State COVID-19 Closure Policy on NON-COVID-19 Health Care Utilization," NBER Working Papers 27621, National Bureau of Economic Research, Inc.
    10. Severin Reissl & Alessandro Caiani & Francesco Lamperti & Tommaso Ferraresi & Leonardo Ghezzi, 2024. "A regional input-output model of the COVID-19 crisis in Italy: decomposing demand and supply factors," Economic Systems Research, Taylor & Francis Journals, vol. 36(1), pages 100-130, January.
    11. Hunt Allcott & Levi Boxell & Jacob C. Conway & Billy A. Ferguson & Matthew Gentzkow & Benjamin Goldman, 2020. "What Explains Temporal and Geographic Variation in the Early US Coronavirus Pandemic?," NBER Working Papers 27965, National Bureau of Economic Research, Inc.
    12. Andrew G. Atkeson & Karen Kopecky & Tao Zha, 2021. "Behavior and the Transmission of COVID-19," AEA Papers and Proceedings, American Economic Association, vol. 111, pages 356-360, May.
    13. Gene Ambrocio, 2022. "Euro-area business confidence and COVID-19," Applied Economics, Taylor & Francis Journals, vol. 54(43), pages 4915-4929, September.
    14. Edward L. Glaeser & Ginger Z. Jin & Benjamin T. Leyden & Michael Luca, 2021. "Learning from deregulation: The asymmetric impact of lockdown and reopening on risky behavior during COVID‐19," Journal of Regional Science, Wiley Blackwell, vol. 61(4), pages 696-709, September.
    15. Christopher J. Cronin & William N. Evans, 2020. "Private Precaution and Public Restrictions: What Drives Social Distancing and Industry Foot Traffic in the COVID-19 Era?," NBER Working Papers 27531, National Bureau of Economic Research, Inc.
    16. Yang, Bixuan & Asche, Frank & Li, Tao, 2021. "Food Price Inflation and Demand Shocks: Evidence from Chinese Cities during the Covid-19 Epidemic," 2021 Annual Meeting, August 1-3, Austin, Texas 314067, Agricultural and Applied Economics Association.
    17. Jaravel, Xavier & O'Connell, Martin, 2020. "Inflation Spike and Falling Product Variety during the Great Lockdown," CEPR Discussion Papers 14880, C.E.P.R. Discussion Papers.
    18. Yenerall, Jackie & Jensen, Kimberly & Chen, Xuqi & Edward Yu, T., 2022. "COVID-19 risk perception and restaurant utilization after easing in-person restrictions," Food Policy, Elsevier, vol. 107(C).
    19. repec:zbw:bofrdp:2021_004 is not listed on IDEAS
    20. George Kapetanios & Nora Neuteboom & Feiko Ritsema & Alexia Ventouri, 2022. "How did consumers react to the COVID‐19 pandemic over time?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 84(5), pages 961-993, October.
    21. David Finck & Peter Tillmann, 2022. "Pandemic Shocks and Household Spending," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 84(2), pages 273-299, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecinqu:v:60:y:2022:i:3:p:1437-1460. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/weaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.