The impact of Lockdown Stringency during the Covid-19 crisis of 2020

Abstract

This paper examines the impact of lockdown stringency on the cross-country variations in real GDP growth and unemployment in OECD countries following the recession caused by the covid-19 pandemic. The GDP is estimated with the Fixed Effects Model and unemployment is estimated with the Random Effects Model. The results show that Lockdown Stringency has indeed affected both the real GDP growth and the unemployment negatively. The study is done very closely to the economic crisis, and the results are therefore naturally in the short run. It is probable that the effects of the economic crisis in the long run will be very different than in the short run.