Lockdown spillovers

Arbeitspapier

Lockdowns imposed to fight the Covid-19 pandemic have cross-border effects. In this paper, we estimate the empirical magnitude of lockdown spillovers in a set of panel local projections. We use daily indicators of economic activity such as stock returns, effective exchange rates, NO2 emissions, mobility and maritime container trade. Lockdown shocks originating in the most important trading partners have a strong and significant adverse effect on economic activity in the home economy. For stock prices and exports, the spillovers can even be larger than the effect of domestic lockdown shocks. The results are robust with respect to alternative country weights used to construct foreign shocks, i.e. weights based on foreign direct investment or the connectedness through value chains. We find that lockdown spillovers have been par-ticularly strong during the first wave of the pandemic. Countries with a higher export share are particularly exposed to lockdown spillovers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: MAGKS Joint Discussion Paper Series in Economics ; No. 15-2022

Classification and Topics

• Classification: Wirtschaft ; Business Fluctuations; Cycles ; Empirical Studies of Trade ; International Factor Movements and International Business: General ; Financial Aspects of Economic Integration ; International Policy Coordination and Transmission ; International Business Cycles
• Subject: panel local projections ; lockdown shocks ; spillovers ; Covid-19 ; pandemic

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Chen, Hongyi ; Tillmann, Peter
• Event: Veröffentlichung
• (who): Philipps-University Marburg, School of Business and Economics
• (where): Marburg
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/262316
• Last update: 10.03.2025, 11:42 AM CET