An Empirical Analysis of COVID-19 Response: Comparison of US with the G7

22 Pages Posted: 21 Jan 2021

See all articles by Mahua Barari

Mahua Barari

Missouri State University - Department of Economics

Srikanta Kundu

Centre for Development Studies (CDS) India

Saibal Mitra

Missouri State University

Date Written: January 19, 2021

Abstract

We compare US policy response to COVID-19 with its G7 counterparts between March and September 2020. The G7 countries, while economically and ideologically aligned, have instituted vastly different policies to mitigate the spread of the disease with varying degrees of compliance. To quantify the effect of policy responses on the spread of infections, we estimate beta for each country which is the slope coefficient of daily new cases in each country regressed against world new cases. First we test for structural breaks in daily data for world new cases using the Bai Perron (1998, 2003a, 2003b) method which endogenously determines break points. We obtain five break dates that allow us to divide the time period into six windows and estimate betas separately for each window. Next we rank the G7 countries based on their beta values for each window. Our empirical findings suggest that countries that eased their lockdown measures moderately while enforcing nationwide mask mandate and comprehensive contact tracing generally performed better in mitigating the spread of new infections. Furthermore, countries with higher degree of compliance saw improvement in their rankings. US was ranked mostly in the bottom half of the G7 group but not always the worst.

Keywords: COVID-19, structural break, G7, stringency index. lockdown

JEL Classification: H11, H77, C23

Suggested Citation

Barari, Mahua and Kundu, Srikanta and Mitra, Saibal, An Empirical Analysis of COVID-19 Response: Comparison of US with the G7 (January 19, 2021). Available at SSRN: https://ssrn.com/abstract=3769540 or http://dx.doi.org/10.2139/ssrn.3769540

Mahua Barari

Missouri State University - Department of Economics ( email )

United States

Srikanta Kundu (Contact Author)

Centre for Development Studies (CDS) India ( email )

Trivandrum 695 011, Kerala
India

Saibal Mitra

Missouri State University ( email )

901 South National Avenue
Springfield, MO 65897
United States

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