Fear, lockdown, and diversion: Comparing drivers of pandemic economic decline 2020

The collapse of economic activity in 2020 from COVID-19 has been immense. An important question is how much that resulted government-imposed restrictions versus people voluntarily choosing to stay home avoid infection. This paper examines the drivers slowdown using cellular phone records data on customer visits more than 2.25 million individual businesses across 110 different industries. Comparing consumer behavior over crisis within same commuting zones but state and county boundaries with policy regimes suggests legal shutdown orders account for only a modest share massive changes (and tracking county-level conditions significantly accurate state-level policies alone). While overall traffic fell by 60 percentage points, explain 7 points this. Individual choices were far seem tied fears Traffic started dropping before place; was highly influenced number COVID deaths reported county; showed clear shift consumers away busier, crowded stores toward smaller, less busy industry. States repealed their saw symmetric, recoveries visits, further supporting small estimated effect policy. Although had little aggregate impact, they did have significant reallocating “nonessential” “essential” restaurants bars groceries other food sellers.