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Government Intervention and Business Response as Determinants of Business Continuity amid COVID-19: The Case of Jordan and Morocco

Author

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  • Fakhoury, Anthony

    (Lebanese American University)

  • Fakih, Ali

    (Lebanese American University)

Abstract

This paper provides new insights into the role of governments and businesses in responding to pandemics in the Arab region. It uses the COVID-19 World Bank Enterprise Survey Follow-up dataset to examine the degree of business endurance in Jordan and Morocco amid the pandemic. Relying on the probit regressions, the empirical findings suggest that businesses that assumed resilient strategies such as establishing an online presence and converting production are more likely to remain open, whereas firms that adopted remote working are less likely to survive. This is due to the unpreparedness of firms and the limited availability of technologies in Jordan and Morocco for teleworking. Further, firms that expected future government supports are more likely to report closure. Finally, our results do not provide evidence that government grants and measures and the level of online sales are statistically significant in our model. The model used also offers further testable hypotheses for future research to comprehend the significance of the response of businesses to unprecedented shocks.

Suggested Citation

  • Fakhoury, Anthony & Fakih, Ali, 2021. "Government Intervention and Business Response as Determinants of Business Continuity amid COVID-19: The Case of Jordan and Morocco," IZA Discussion Papers 14583, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14583
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    References listed on IDEAS

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    1. Alexander W. Bartik & Marianne Bertrand & Zoë B. Cullen & Edward L. Glaeser & Michael Luca & Christopher T. Stanton, 2020. "How Are Small Businesses Adjusting to COVID-19? Early Evidence from a Survey," NBER Working Papers 26989, National Bureau of Economic Research, Inc.
    2. Evan DeFilippis & Stephen Michael Impink & Madison Singell & Jeffrey T. Polzer & Raffaella Sadun, 2020. "Collaborating During Coronavirus: The Impact of COVID-19 on the Nature of Work," NBER Working Papers 27612, National Bureau of Economic Research, Inc.
    3. Ashraf, Badar Nadeem, 2020. "Economic impact of government interventions during the COVID-19 pandemic: International evidence from financial markets," Journal of Behavioral and Experimental Finance, Elsevier, vol. 27(C).
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    Cited by:

    1. Onjewu, Adah-Kole Emmanuel & Olan, Femi & Nyuur, Richard Benon-be-isan & Paul, Salima & Nguyen, Ha Thanh Truc, 2023. "The effect of government support on Bureaucracy, COVID-19 resilience and export intensity: Evidence from North Africa," Journal of Business Research, Elsevier, vol. 156(C).
    2. Syden Mishi & Nomonde Tshabalala & Godfred Anakpo & Weliswa Matekenya, 2023. "COVID-19 Experiences and Coping Strategies: The Case of Differently Sized Businesses in South Africa," Sustainability, MDPI, vol. 15(10), pages 1-19, May.

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    More about this item

    Keywords

    business continuity; business response; government intervention; remote working; COVID-19; Jordan; Morocco;
    All these keywords.

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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