When and how do business shutdowns work? Evidence from Italy's first COVID-19 wave.

Governments around the world have adopted unprecedented policies to deal with COVID-19. This paper zooms in on business shutdowns and investigates their effectiveness in reducing mortality. We leverage highly granular death registry data for almost 5000 Italian municipalities in a diff-in-diff approach that allows us to mitigate endogeneity concerns credibly. Our results, which are robust to controlling for a host of co-factors, offer strong evidence that business shutdowns effectively curb mortality. We calculate that they may have reduced the death toll from the first wave of COVID-19 in Italy by about 40%. Our findings also highlight that timeliness is key - by acting 1 week earlier, their effectiveness could have been increased by an additional 5%. Finally, shutdowns should be targeted. Closing service activities with a high degree of interpersonal contact saves the most lives. Shutting down production activities, while substantially reducing mobility, only has mild effects on mortality.

COVID-19 in Italy: An Analysis of Death Registry Data.

BACKGROUND: There are still many unknowns about COVID-19. We do not know its exact mortality rate nor the speed through which it spreads across communities. This lack of evidence complicates the design of appropriate response policies. METHODS: We source daily death registry data for 4100 municipalities in Italy's north and match them to Census data. We augment the dataset with municipality-level data on a host of co-factors of COVID-19 mortality, which we exploit in a differences-in-differences regression model to analyze COVID-19-induced mortality. RESULTS: We find that COVID-19 killed more than 0.15% of the local population during the first wave of the epidemic. We also show that official statistics vastly underreport this death toll, by about 60%. Next, we uncover the dramatic effects of the epidemic on nursing home residents in the outbreak epicenter: in municipalities with a high share of the elderly living in nursing homes, COVID-19 mortality was about twice as high as in those with no nursing home intown. CONCLUSIONS: A pro-active approach in managing the epidemic is key to reduce COVID-19 mortality. Authorities should ramp-up testing capacity and increase contact-tracing abilities. Adequate protective equipment should be provided to nursing home residents and staff.