ABSTRACT
Administrative restrictions on public mobility may impose significant well-being impacts on society. For instance, there has been a wide discussion on the psychological effects of lockdown policies during the pandemic. However, there is limited knowledge regarding the consequences of the policy transition and the uncertainty that arises from shifting from tight to loose regulations. The unexpected removal of Zero-COVID policies in China provides a special opportunity to study how policy uncertainty may affect mental health or subjective well-being. We use the Baidu Index data to test the effects of switching toward a "live-with-COVID” policy and the consequent rapid COVID spread on the frequency of well-being related search terms in China. Through a three-phase difference-in-differences approach with multiple years to check parallel sentiment trends, we find a substantial increase in fear and social dysfunction during the Transition Period when COVID-related restrictions were not fully lifted, as well as in the following Free-Spread Period. In comparison, the increase of anxiety mainly took place in the Transition Period. However, searches for anger and negative behaviors stayed relatively stable. Our results suggest that the removal of Zero-COVID policies, especially the Transition Period that generated policy uncertainty, significantly affected people's mental health.