Impact of Stimulus Packages on Business Recovery During the COVID-19 Pandemic in Bangladesh

Abstract

The COVID-19 pandemic significantly impacted Bangladesh’s economy, leading to disruptions in supply chains and a decline in business activities. To counter these effects, the government introduced stimulus packages aiming to aid business recovery. This article evaluates the impact of these measures using a unique dataset from the Business Confidence Index survey conducted by the South Asian Network on Economic Modeling in April 2021. This survey covered 503 firms across eight divisions in Bangladesh. Using the Propensity Score Matching technique for causal estimation, findings suggest that firms that availed the stimulus packages demonstrated around 9 percentage points higher recovery than those that did not. Such insights are instrumental for future policy design and strengthening evidence-based policymaking.