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Learning from Deregulation: The Asymmetric Impact of Lockdown and Reopening on Risky Behavior During COVID-19

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  • Edward L. Glaeser
  • Ginger Zhe Jin
  • Benjamin T. Leyden
  • Michael Luca

Abstract

During the COVID-19 pandemic, states issued and then rescinded stay-at-home orders that restricted mobility. We develop a model of learning by deregulation, which predicts that lifting stay-at-home orders can signal that going out has become safer. Using restaurant activity data, we find that the implementation of stay-at-home orders initially had a limited impact, but that activity rose quickly after states’ reopenings. The results suggest that consumers inferred from reopening that it was safer to eat out. The rational, but mistaken inference that occurs in our model may explain why a sharp rise of COVID-19 cases followed reopening in some states.

Suggested Citation

  • Edward L. Glaeser & Ginger Zhe Jin & Benjamin T. Leyden & Michael Luca, 2020. "Learning from Deregulation: The Asymmetric Impact of Lockdown and Reopening on Risky Behavior During COVID-19," NBER Working Papers 27650, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:27650
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    4. Dhaval Dave & Andrew I. Friedson & Kyutaro Matsuzawa & Drew McNichols & Joseph J. Sabia, 2023. "Sudden lockdown repeals, social mobility, and COVID‐19: Evidence from a judicial natural experiment," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 20(2), pages 272-304, June.
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    6. Gonzalez-Pampillon, Nicolas & Nunez-Chaim, Gonzalo & Overman, Henry G., 2024. "The economic impacts of the UK's eat out to help out scheme," Journal of Urban Economics, Elsevier, vol. 143(C).
    7. Thiemo Fetzer, 2022. "Subsidising the spread of COVID-19: Evidence from the UK’S Eat-Out-to-Help-Out Scheme," The Economic Journal, Royal Economic Society, vol. 132(643), pages 1200-1217.
    8. Thuy D. Nguyen & Sumedha Gupta & Martin S. Andersen & Ana I. Bento & Kosali I. Simon & Coady Wing, 2021. "Impacts of state COVID‐19 reopening policy on human mobility and mixing behavior," Southern Economic Journal, John Wiley & Sons, vol. 88(2), pages 458-486, October.
    9. Stefanie Haeffele & Jordan K. Lofthouse & Agustin Forzani, 2023. "The Perils of Regulating COVID–19: Insights from Kirznerian Entrepreneurship and Ostromian Polycentricity," Economics of Governance, Springer, vol. 24(3), pages 331-355, September.
    10. Oudom Hean & Nattanicha Chairassamee, 2023. "The effects of the COVID-19 pandemic on U.S. entrepreneurship," Letters in Spatial and Resource Sciences, Springer, vol. 16(1), pages 1-22, December.
    11. Chie Hirama & Zechen Zeng & Nobutoshi Nawa & Takeo Fujiwara, 2022. "Association between Cooperative Attitude and High-Risk Behaviors on the Spread of COVID-19 Infection among Medical Students in Japan," IJERPH, MDPI, vol. 19(24), pages 1-10, December.
    12. Sedov, Dmitry, 2022. "Restaurant closures during the COVID-19 pandemic: A descriptive analysis," Economics Letters, Elsevier, vol. 213(C).
    13. Callaway, Brantly & Li, Tong, 2023. "Policy evaluation during a pandemic," Journal of Econometrics, Elsevier, vol. 236(1).
    14. Bisin, Alberto & Moro, Andrea, 2022. "JUE insight: Learning epidemiology by doing: The empirical implications of a Spatial-SIR model with behavioral responses," Journal of Urban Economics, Elsevier, vol. 127(C).
    15. Shin, Su Hyun & Ji, Hyunjung & Lim, HanNa, 2021. "Heterogeneity in preventive behaviors during COVID-19: Health risk, economic insecurity, and slanted information," Social Science & Medicine, Elsevier, vol. 278(C).
    16. Xiaolan Zhou & Yasuyuki Sawada & Matthew Shum & Elaine S. Tan, 2024. "COVID-19 containment policies, digitalization and sustainable development goals: evidence from Alibaba’s administrative data," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-16, December.
    17. Nicolás González-Pampillón & Gonzalo Nunez-Chaim & Katharina Ziegler, 2021. "Recovering from the first Covid-19 lockdown: Economic impacts of the UK's Eat Out to Help Out scheme," CEP Covid-19 Analyses cepcovid-19-018, Centre for Economic Performance, LSE.
    18. Dylan Balla‐Elliott & Zoë B. Cullen & Edward L. Glaeser & Michael Luca & Christopher Stanton, 2022. "Determinants Of Small Business Reopening Decisions After Covid Restrictions Were Lifted," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 41(1), pages 278-317, January.
    19. Bussolo, Maurizio & Sarma, Nayantara & Torre, Iván, 2023. "The links between COVID-19 vaccine acceptance and non-pharmaceutical interventions," Social Science & Medicine, Elsevier, vol. 320(C).
    20. Lily Shen & Sean Wilkoff, 2022. "Cleanliness is next to income: The impact of COVID‐19 on short‐term rentals," Journal of Regional Science, Wiley Blackwell, vol. 62(3), pages 799-829, June.
    21. Alexandre K Ligo & Emerson Mahoney & Jeffrey Cegan & Benjamin D Trump & Andrew S Jin & Maksim Kitsak & Jesse Keenan & Igor Linkov, 2021. "Relationship among state reopening policies, health outcomes and economic recovery through first wave of the COVID-19 pandemic in the U.S," PLOS ONE, Public Library of Science, vol. 16(11), pages 1-21, November.
    22. M. Kate Bundorf & Jill DeMatteis & Grant Miller & Maria Polyakova & Jialu L. Streeter & Jonathan Wivagg, 2021. "Risk Perceptions and Protective Behaviors: Evidence from COVID-19 Pandemic," NBER Working Papers 28741, National Bureau of Economic Research, Inc.

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    More about this item

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K0 - Law and Economics - - General

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