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1.
SSRN;
Preprint in English | SSRN | ID: ppcovidwho-325883

ABSTRACT

We quantify and study state-level economic policy uncertainty. Tapping digital archives for nearly 3,500 local newspapers, we construct three monthly indexes for each state: one that captures state and local sources of policy uncertainty (EPU-S), one that captures national and international sources (EPU-N), and a composite index that captures both. EPU-S rises around gubernatorial elections and own-state episodes like the California electricity crisis of 2000-01 and the Kansas tax experiment of 2012. EPU-N rises around presidential elections and in response to 9-11, Gulf Wars I and II, the 2011 debt-ceiling crisis, the 2012 fiscal cliff episode, and federal government shutdowns. Close elections elevate policy uncertainty much more than the average election. The COVID-19 pandemic drove huge increases in policy uncertainty and unemployment, more so in states with stricter government-mandated lockdowns. VAR models fit to pre-COVID data imply that upward shocks to own-state EPU foreshadow weaker economic activity in the state.

2.
Earth's Future ; 10(1), 2022.
Article in English | ProQuest Central | ID: covidwho-1655470

ABSTRACT

As the COVID‐19 virus spread over the world, governments restricted mobility to slow transmission. Public health measures had different intensities across European countries but all had significant impact on people's daily lives and economic activities, causing a drop of CO2 emissions of about 10% for the whole year 2020. Here, we analyze changes in natural gas use in the industry and gas distribution to the built environment during the first half of year 2020 with daily gas flows data from pipeline and storage facilities in Europe. We find that reductions of industrial gas use reflect decreases in industrial production across most countries. Surprisingly, natural gas use in the built environment also decreased despite most people being confined at home and cold spells in March 2020. Those reductions that we attribute to the impacts of COVID‐19 remain of comparable magnitude to previous variations induced by cold or warm climate anomalies in the cold season. We conclude that climate variations played a larger role than COVID‐19 induced stay‐home orders in natural gas consumption across Europe.

3.
Journal of the Japanese and International Economies ; : 101192, 2022.
Article in English | ScienceDirect | ID: covidwho-1629889

ABSTRACT

We develop new economic policy uncertainty (EPU) indices for Japan from January 1987 onwards, building on Baker, Bloom and Davis (2016). Each index reflects the frequency of newspaper articles that contain certain terms pertaining to the economy, policy matters, and uncertainty. Our overall EPU index co-varies positively with implied volatilities for Japanese equities, exchange rates, and interest rates and with a survey-based measure of political uncertainty. It rises around contested national elections and major leadership transitions in Japan, during the Asian financial crisis and in reaction to the Lehman Brothers failure, U.S. debt downgrade in 2011, Brexit referendum, the deferral of a consumption tax hike, and the onset of the COVID-19 pandemic. Our uncertainty indices for fiscal, monetary, trade, and exchange rate policy co-vary positively but also display distinct dynamics. For example, our trade policy uncertainty (TPU) index rocketed upwards when the U.S. withdrew from the Trans-Pacific Partnership. VAR models imply that upward EPU innovations foreshadow deteriorations in Japan's macroeconomic performance, as reflected by impulse response functions for investment, employment, and output. Our study adds to evidence that credible policy plans and strong policy frameworks can favorably influence macroeconomic performance by reducing policy uncertainty.

4.
Innovation (N Y) ; 3(1): 100182, 2022 Jan 25.
Article in English | MEDLINE | ID: covidwho-1592934

ABSTRACT

Precise and high-resolution carbon dioxide (CO2) emission data is of great importance in achieving carbon neutrality around the world. Here we present for the first time the near-real-time Global Gridded Daily CO2 Emissions Dataset (GRACED) from fossil fuel and cement production with a global spatial resolution of 0.1° by 0.1° and a temporal resolution of 1 day. Gridded fossil emissions are computed for different sectors based on the daily national CO2 emissions from near-real-time dataset (Carbon Monitor), the spatial patterns of point source emission dataset Global Energy Infrastructure Emissions Database (GID), Emission Database for Global Atmospheric Research (EDGAR), and spatiotemporal patters of satellite nitrogen dioxide (NO2) retrievals. Our study on the global CO2 emissions responds to the growing and urgent need for high-quality, fine-grained, near-real-time CO2 emissions estimates to support global emissions monitoring across various spatial scales. We show the spatial patterns of emission changes for power, industry, residential consumption, ground transportation, domestic and international aviation, and international shipping sectors from January 1, 2019, to December 31, 2020. This gives thorough insights into the relative contributions from each sector. Furthermore, it provides the most up-to-date and fine-grained overview of where and when fossil CO2 emissions have decreased and rebounded in response to emergencies (e.g., coronavirus disease 2019 [COVID-19]) and other disturbances of human activities of any previously published dataset. As the world recovers from the pandemic and decarbonizes its energy systems, regular updates of this dataset will enable policymakers to more closely monitor the effectiveness of climate and energy policies and quickly adapt.

5.
Sci Adv ; 7(45): eabf9415, 2021 Nov 05.
Article in English | MEDLINE | ID: covidwho-1501514

ABSTRACT

Activity reductions in early 2020 due to the coronavirus disease 2019 pandemic led to unprecedented decreases in carbon dioxide (CO2) emissions. Despite their record size, the resulting atmospheric signals are smaller than and obscured by climate variability in atmospheric transport and biospheric fluxes, notably that related to the 2019­2020 Indian Ocean Dipole. Monitoring CO2 anomalies and distinguishing human and climatic causes thus remain a new frontier in Earth system science. We show that the impact of short-term regional changes in fossil fuel emissions on CO2 concentrations was observable from space. Starting in February and continuing through May, column CO2 over many of the world's largest emitting regions was 0.14 to 0.62 parts per million less than expected in a pandemic-free scenario, consistent with reductions of 3 to 13% in annual global emissions. Current spaceborne technologies are therefore approaching levels of accuracy and precision needed to support climate mitigation strategies with future missions expected to meet those needs.

6.
National Bureau of Economic Research Working Paper Series ; No. 28731, 2021.
Article in English | NBER, Grey literature | ID: grc-748652

ABSTRACT

COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We develop evidence on five reasons for this large shift: better-than-expected WFH experiences, new investments in physical and human capital that enable WFH, greatly diminished stigma associated with WFH, lingering concerns about crowds and contagion risks, and a pandemic-driven surge in technological innovations that support WFH. We also use our survey data to project three consequences: First, employees will enjoy large benefits from greater remote work, especially those with higher earnings. Second, the shift to WFH will directly reduce spending in major city centers by at least 5-10 percent relative to the pre-pandemic situation. Third, our data on employer plans and the relative productivity of WFH imply a 5 percent productivity boost in the post-pandemic economy due to re-optimized working arrangements. Only one-fifth of this productivity gain will show up in conventional productivity measures, because they do not capture the time savings from less commuting.

7.
National Bureau of Economic Research Working Paper Series ; No. 26945, 2020.
Article in English | NBER, Grey literature | ID: grc-748613

ABSTRACT

No previous infectious disease outbreak, including the Spanish Flu, has impacted the stock market as forcefully as the COVID-19 pandemic. In fact, previous pandemics left only mild traces on the U.S. stock market. We use text-based methods to develop these points with respect to large daily stock market moves back to 1900 and with respect to overall stock market volatility back to 1985. We also evaluate potential explanations for the unprecedented stock market reaction to the COVID-19 pandemic. The evidence we amass suggests that government restrictions on commercial activity and voluntary social distancing, operating with powerful effects in a service-oriented economy, are the main reasons the U.S. stock market reacted so much more forcefully to COVID-19 than to previous pandemics in 1918-19, 1957-58 and 1968.

8.
National Bureau of Economic Research Working Paper Series ; No. 28320, 2021.
Article in English | NBER, Grey literature | ID: grc-748587

ABSTRACT

Stock prices and workplace mobility trace out striking clockwise paths in daily data from mid-February to late May 2020. Global stock prices fell 30 percent from 17 February to 12 March, before mobility declined. Over the next 11 days, stocks fell another 10 percentage points as mobility dropped 40 percent. From 23 March to 9 April, stocks recovered half their losses and mobility fell further. From 9 April to late May, both stocks and mobility rose modestly. This dynamic plays out across the 35 countries in our sample, with notable departures in China, South Korea, and Taiwan. The size of the global stock market crash in reaction to the pandemic is many times larger than a standard asset-pricing model implies. Looking more closely at the world’s two largest economies, the pandemic had greater effects on stock market levels and volatilities in the U.S. than in China even before it became evident that early U.S. containment efforts would flounder. Newspaper-based narrative evidence confirms the dominant – and historically unprecedented – role of pandemic-related developments in the stock market behavior of both countries.

9.
National Bureau of Economic Research Working Paper Series ; No. 29102, 2021.
Article in English | NBER, Grey literature | ID: grc-748435

ABSTRACT

About one-fifth of paid workdays will be supplied from home in the post-pandemic economy, and more than one-fourth on an earnings-weighted basis. In view of this projection, we consider some implications of home internet access quality, exploiting data from the new Survey of Working Arrangements and Attitudes. Moving to high-quality, fully reliable home internet service for all Americans (“universal access”) would raise earnings-weighted labor productivity by an estimated 1.1% in the coming years. The implied output gains are $160 billion per year, or $4 trillion when capitalized at a 4% rate. Estimated flow output payoffs to universal access are nearly three times as large in economic disasters like the COVID-19 pandemic. Our survey data also say that subjective well-being was higher during the pandemic for people with better home internet service conditional on age, employment status, earnings, working arrangements, and other controls. In short, universal access would raise productivity, and it would promote greater economic and social resilience during future disasters that inhibit travel and in-person interactions.

10.
National Bureau of Economic Research Working Paper Series ; No. 27867, 2020.
Article in English | NBER, Grey literature | ID: grc-748340

ABSTRACT

Firm-level stock returns differ enormously in reaction to COVID-19 news. We characterize these reactions using the Risk Factors discussions in pre-pandemic 10-K filings and two text-analytic approaches: expert-curated dictionaries and supervised machine learning (ML). Bad COVID-19 news lowers returns for firms with high exposures to travel, traditional retail, aircraft production and energy supply—directly and via downstream demand linkages—and raises them for firms with high exposures to healthcare policy, e-commerce, web services, drug trials and materials that feed into supply chains for semiconductors, cloud computing and telecommunications. Monetary and fiscal policy responses to the pandemic strongly impact firm-level returns as well, but differently than pandemic news. Despite methodological differences, dictionary and ML approaches yield remarkably congruent return predictions. Importantly though, ML operates on a vastly larger feature space, yielding richer characterizations of risk exposures and outperforming the dictionary approach in goodness-of-fit. By integrating elements of both approaches, we uncover new risk factors and sharpen our explanations for firm-level returns. To illustrate the broader utility of our methods, we also apply them to explain firm-level returns in reaction to the March 2020 Super Tuesday election results.

11.
National Bureau of Economic Research Working Paper Series ; No. 27418, 2020.
Article in English | NBER, Grey literature | ID: grc-748297

ABSTRACT

We consider several economic uncertainty indicators for the US and UK before and during the COVID-19 pandemic: implied stock market volatility, newspaper-based economic policy uncertainty, twitter chatter about economic uncertainty, subjective uncertainty about future business growth, and disagreement among professional forecasters about future GDP growth. Three results emerge. First, all indicators show huge uncertainty jumps in reaction to the pandemic and its economic fallout. Indeed, most indicators reach their highest values on record. Second, peak amplitudes differ greatly – from a rise of around 100% (relative to January 2020) in two-year implied volatility on the S&P 500 and subjective uncertainty around year-ahead sales for UK firms to a 20-fold rise in forecaster disagreement about UK growth. Third, time paths also differ: Implied volatility rose rapidly from late February, peaked in mid-March, and fell back by late March as stock prices began to recover. In contrast, broader measures of uncertainty peaked later and then plateaued, as job losses mounted, highlighting the difference in uncertainty measures between Wall Street and Main Street.

12.
National Bureau of Economic Research Working Paper Series ; No. 26983, 2020.
Article in English | NBER, Grey literature | ID: grc-748244

ABSTRACT

Assessing the economic impact of the COVID-19 pandemic is essential for policymakers, but challenging because the crisis has unfolded with extreme speed. We identify three indicators – stock market volatility, newspaper-based economic uncertainty, and subjective uncertainty in business expectation surveys – that provide real-time forward-looking uncertainty measures. We use these indicators to document and quantify the enormous increase in economic uncertainty in the past several weeks. We also illustrate how these forward-looking measures can be used to assess the macroeconomic impact of the COVID-19 crisis. Specifically, we feed COVID-induced first-moment and uncertainty shocks into an estimated model of disaster effects developed by Baker, Bloom and Terry (2020). Our illustrative exercise implies a year-on-year contraction in U.S. real GDP of nearly 11 percent as of 2020 Q4, with a 90 percent confidence interval extending to a nearly 20 percent contraction. The exercise says that about half of the forecasted output contraction reflects a negative effect of COVID-induced uncertainty.

13.
National Bureau of Economic Research Working Paper Series ; No. 27137, 2020.
Article in English | NBER, Grey literature | ID: grc-748238

ABSTRACT

Drawing on firm-level expectations at a one-year forecast horizon in the Survey of Business Uncertainty (SBU), we construct novel, forward-looking reallocation measures for jobs and sales. These measures rise sharply after February 2020, reaching rates in April that are 2.4 (3.9) times the pre-COVID average for jobs (sales). We also draw on special questions in the April SBU to quantify the near-term impact of the COVID-19 shock on business staffing. We find 3 new hires for every 10 layoffs caused by the shock and estimate that 42 percent of recent layoffs will result in permanent job loss. Our survey evidence aligns well with anecdotal evidence of large pandemic-induced demand increases at some firms, with contemporaneous evidence on gross business formation, and with a sharp pandemic-induced rise in equity return dispersion across firms. After developing the evidence, we consider implications of our evidence for the economic outlook and for policy responses to the pandemic. Unemployment benefit levels that exceed worker earnings, policies that subsidize employee retention, occupational licensing restrictions, and regulatory barriers to business formation will impede reallocation responses to the COVID-19 shock.

14.
Seoul Journal of Economics ; 34(1):17-25, 2021.
Article in English | ProQuest Central | ID: covidwho-1140865

ABSTRACT

The 2020 U.S. elections produced a close, but clear, victory for Democratic nominee Joe Biden in the presidential contest, a surprisingly slim majority for the Democratic party in the House of Representatives, and an even 50-50 split between Republicans and Democrats in the Senate. 1 Newly elected Democratic Vice President Kamala Harris holds the deciding vote for party control in the Senate. Thus, the Democratic party now controls the executive branch of the federal government and both Houses of Congress - a huge shift in the balance of political power.

15.
Nature Climate Change ; 11(3):197-199, 2021.
Article in English | ProQuest Central | ID: covidwho-1117347

ABSTRACT

Five years after the adoption of the Paris Climate Agreement, growth in global CO2 emissions has begun to falter. The pervasive disruptions from the COVID-19 pandemic have radically altered the trajectory of global CO2 emissions. Contradictory effects of the post-COVID-19 investments in fossil fuel-based infrastructure and the recent strengthening of climate targets must be addressed with new policy choices to sustain a decline in global emissions in the post-COVID-19 era.Growth in CO2 emissions has slowed since the Paris Agreement 5 years ago. The COVID-19 pandemic has caused a drop in emissions of about 7% in 2020 relative to 2019, but strong policy is needed to address underlying drivers and to sustain a decline in global emissions beyond the current crisis.

19.
Geophys Res Lett ; : e2020GL090244, 2020 Oct 29.
Article in English | MEDLINE | ID: covidwho-989693

ABSTRACT

We use a global transport model and satellite retrievals of the carbon dioxide (CO2) column average to explore the impact of CO2 emissions reductions that occurred during the economic downturn at the start of the Covid-19 pandemic. The changes in the column averages are substantial in a few places of the model global grid, but the induced gradients are most often less than the random errors of the retrievals. The current necessity to restrict the quality-assured column retrievals to almost cloud-free areas appears to be a major obstacle in identifying changes in CO2 emissions. Indeed, large changes have occurred in the presence of clouds and, in places that were cloud-free in 2020, the comparison with previous years is hampered by different cloud conditions during these years. We therefore recommend to favor all-weather CO2 monitoring systems, at least in situ, to support international efforts to reduce emissions.

20.
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