Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223590
Authors: 
Milani, Fabio
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper No. 8518
Abstract: 
This paper studies the social and economic responses to the Covid-19 pandemic in a large sample of countries. I stress, in particular, the importance of countries' interconnections to un-derstand the spread of the virus. I estimate a Global VAR model and exploit a dataset on existing social connections across country borders. I show that social networks help explain not only the spread of the disease, but also cross-country spillovers in perceptions about coronavirus risk and in social distancing behavior. In the early phases of the pandemic, perceptions of coronavirus risk in most countries are affected by pandemic shocks originating in Italy. Later, the U.S., Spain, and the U.K. play sizable roles. Social distancing responses to domestic and global health shocks are heterogeneous; however, they almost always exhibit delays and sluggish adjustments. Unemployment responses vary widely across countries. Unemployment is particularly responsive to health shocks in the U.S. and Spain, while unemployment fluctuations are attenuated almost everywhere else.
Subjects: 
Covid-19 pandemic
health shocks
global VAR
social networks
social distancing
cross-country spillovers
unemployment indicators
Google trends
JEL: 
C32
F69
I12
I18
L86
Z13
Document Type: 
Working Paper

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