Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/249356 
Year of Publication: 
2020
Series/Report no.: 
JRC Working Papers in Economics and Finance No. 2020/04
Publisher: 
Publications Office of the European Union, Luxembourg
Abstract: 
The economic crisis caused by the covid-19 pandemic is unprecedented in recent history. We contribute to a growing literature investigating the economic consequences of covid-19 by showing how unemployment-related online searches across the EU27 reacted to the introduction of lock-downs. We exploit Google Trends topics to retrieve over two thousand search queries related to unemployment in 27 countries. We nowcast the monthly unemployment rate in the EU Member States to assess the relationship between search data and the underlying phenomenon as well as to identify the keywords that improve predictive accuracy. Drawing from this finding, we use the set of best predictors in a Difference-in-Differences framework to document a surge of unemploymentrelated searches in the wake of lock-downs of about 30%. This effect persists for more than five weeks. We suggest that the effect is most likely due to an increase in unemployment expectations.
Subjects: 
Unemployment
nowcast
random forest
covid-19
Google Trends
Difference-in-Differences
JEL: 
E24
C21
C53
Persistent Identifier of the first edition: 
ISBN: 
978-92-76-19817-8
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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