Does COVID-19 Affect Household Financial Behaviors? Fresh Evidence From China

ABSTRACT

Based on online survey data from 2020, the present study employed a logit model to examine the effects of COVID-19 on household financial behaviors in China. Additionally, the KHB (Kohler, Karlson, Holm) model was employed to explore the pathway through which COVID-19 affects household financial behaviors. These analyses revealed that household saving and borrowing behaviors were more sensitive to COVID-19 than insurance and investment behaviors. Moreover, the effects of COVID-19 on household saving and investment behaviors were found to be mediated by attitudes toward COVID-19. These findings suggest that more effective measures to reduce households' panic attitude to public health emergencies can diminish fluctuations in household financial behaviors in the short term.