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The effects of COVID‐19 containment measures on the Asia‐Pacific region

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  • Davide Furceri
  • Siddharth Kothari
  • Longmei Zhang

Abstract

As the COVID‐19 pandemic spread across the world, governments introduced significant containment measures to control the spread of the virus. In this paper, we leverage inputs from IMF desk economists to construct a novel narrative index of containment measures for 11 countries in the Asia‐Pacific region. A key innovation in our index is that it distinguishes between economic sectors (services, industry, retail), thus providing a more granular view of restrictions related to economic activity. Using this index, along with other high‐frequency data, we find that containment measures have been successful in reducing the spread of the virus (though with some heterogeneity) but have also been associated with large short‐term economic costs. Furthermore, exploiting the granularity of our index, we find that differences in strategies across countries regarding the closing of the industrial sector have mattered: imposing less severe restrictions on industry has been associated with lower economic costs without leading to worse health outcomes, possibly reflecting the less contact intensive nature of industrial activity.

Suggested Citation

  • Davide Furceri & Siddharth Kothari & Longmei Zhang, 2021. "The effects of COVID‐19 containment measures on the Asia‐Pacific region," Pacific Economic Review, Wiley Blackwell, vol. 26(4), pages 469-497, October.
    • Handle: RePEc:bla:pacecr:v:26:y:2021:i:4:p:469-497
    DOI: 10.1111/1468-0106.12369
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    Cited by:

    1. Guglielmo Maria Caporale & Abdurrahman Nazif Çatık & Mohamad Husam Helmi & Coşkun Akdeniz & Ali İlhan, 2024. "Time-varying effects of the COVID-19 pandemic on stock markets and economic activity: evidence from the US and Europe," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 51(2), pages 529-558, May.
    2. Klose, Jens & Tillmann, Peter, 2022. "The Real and Financial Impact of COVID-19 Around the World," VfS Annual Conference 2022 (Basel): Big Data in Economics 264030, Verein für Socialpolitik / German Economic Association.

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