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COVID-19 social distancing measures and economic growth: Distinguishing short- and long-term effects

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  • Ashraf, Badar Nadeem
  • Goodell, John W.

Abstract

Social distancing policies have been criticized for their adverse effect on economies. However, we evidence that while they have a short-run adverse effect, they also have a long-run recovery effect on economic growth. Utilizing quarterly gross domestic product (GDP) growth rate data from OECD member states, we find that the medium-term recovery effect of stringent social distancing policies on economic growth is three times higher the short-term adverse effect. We additionally investigate social distancing measures with sub-components of GDP, as well as the conditioning roles of institutional factors.

Suggested Citation

  • Ashraf, Badar Nadeem & Goodell, John W., 2022. "COVID-19 social distancing measures and economic growth: Distinguishing short- and long-term effects," Finance Research Letters, Elsevier, vol. 47(PA).
    • Handle: RePEc:eee:finlet:v:47:y:2022:i:pa:s1544612321005742
    DOI: 10.1016/j.frl.2021.102639
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