Gimme shelter. Social distancing and income support in times of pandemic

Abstract

Stay-at-home orders feature high in the set of policies used to curb the spread of epidemics such as COVID-19, but are potentially less efficient among poor people who must continue to work during pandemics. We examine how income support programs help poor people comply with stay-at-home order and thereby generate positive health externalities. We use data on work-related mobility in 2020 and on poverty rates for 729 subnational regions of Africa, Latin America and Asia. We focus on within-country differential mobility changes between higher- and lower-poverty regions. Accounting for all time-variant country-level factors, we show that lockdowns have decreased mobility significantly less in poorer regions. In turn, emergency income support programs have helped reduce this difference, mitigating the regional poverty gap in virus exposure through work mobility.