Private Expenditure Research Articles

Impact of Environmental Quality on Healthcare Expenditures in Developing Countries: A Panel Data Approach

Objective: The deterioration in environmental quality has an economic and social cost. The aim of this study is to analyze the impact of environmental factors on health expenditures in developing countries. Method: To analyze the relationship between environmental quality (air pollution and temperature) and health expenditure in thirty-three developing countries, the study uses system generalized method of moments (GMM) using data from 2000 to 2017. Results: The results suggest a positive effect of both air pollution and temperature on health expenditure. However, the effect is highest for government health expenditure, followed by private and total health expenditure in the studied countries. The results further suggest that the impact of environmental factors is greater in higher-income countries when we divide the studied countries into two groups, i.e., higher- and lower-income countries. Conclusion: Our results are interesting and informative for the policy makers to design such policies to attain better environmental quality and social well-being. The increased healthcare expenditures due to increased air pollution and climate change necessitate for an efficient, reliable, affordable and modern energy policy by emphasizing the use of clean and renewable energy in these countries that ensure better health for the masses. Furthermore, a smart and sustainable environmentally friendly economic growth policy is necessary to ensure better health for the masses.

Health Expenditures, Health Infrastructure and Health Status in SAARC Countries: A Panel Data Analysis

Scholars in health economics have been studying the relationship between healthcare expenditure and health outcomes for the last half-century. Researchers emphasized the increase of public health expenditure towards providing primary healthcare based on the logic that health expenditure has a direct effect on the health outcomes of the people. However, such studies have a lot of inconsistencies. Given the background, the present study has three research objectives. First, to investigate the effect of healthcare spending on multiple health outcomes in SAARC nations after controlling for country-specific health infrastructures and economic conditions. Second, to undertake a differential analysis of the effect of public and private healthcare spending (both aggregate and out of pocket) on specific health outcomes. Third, to explore the presence (if any) of the differential effect of health expenditure and health infrastructure variables on specific health outcome variables, including mortality and morbidity indicators. Based on a 20-year (1993–2012) panel data from seven SAARC countries, health expenditure was found to influence improved health outcomes in SAARC nations. In addition, the differential effect of public, private and out-of-pocket (OOP) health expenditure was observed on different health outcomes. Thus, OOP expenditures was found to be the major influencer of life expectancy, death rate and TB instances, while public expenditure was found to be influential for improving infant mortality rate (IMR). The present study supports the notion that disaggregated effects of health expenditure (by including the effect of public, private and OOP expenditures) are needed to get a complete understanding of the health expenditure–health outcome linkage. In addition, the findings emphasize on the role of proximal predictors of health outcomes (alongside expenditure variables in the same model) as important inclusion in the health expenditure-health outcome investigation.

The economic impact of long-term care services

Abstract Projections show sharp increases in public spending on long-term care (LTC) services across Europe. However, a purely cost-based focus on LTC services is economically misleading. Private and public expenditure on LTC services directly and indirectly generates income in the form of salaries, taxes, and social security contributions. The aim of this paper is to quantify the economic impact and multipliers of LTC services for Austria. Based on an econometric regional Input-Output model for Austria, we estimate the direct, indirect, and induced effects of public and private expenditures on value added, employment, taxes, and social security contributions. According to our results, each euro spent on LTC services is associated with domestic value added of € 1.70; 70 cents per euro spent flows into public budgets in the form of taxes and social security contributions. The economic multipliers of the LTC services are comparatively high due to the high share of wages and salaries in direct expenditure and the associated high direct value added. Public expenditure on professional care services should therefore not be regarded merely as a cost factor in the public budget. Rather, this rapidly growing economic sector is also an increasingly important economic factor in a time of ageing societies. While the model does not provide information on the causal economic effect of the LTC sector, the findings are still highly important for planners of LTC reforms, as they provide information on the total value added associated with LTC expenditures and on the total number of jobs that these expenditures sustain.

교원 임용시험 지원자의 사교육비 지출 실태와 영향

This study analyzed the level and impact of private education expenditure of teachers appointment exam applicants using five waves of Graduates Occupational Mobility Survey. Considering heterogeneous characteristics of primary and secondary teacher resources and different pass rates of appointment exams, we divided samples of primary and secondary teacher applicants. The findings are as follows. First, primary teacher applicants spent about 310 thousand won for private education on average. Private education expenditure for Hagwon was 470 thousand won while that for lectures on campus cost 220 thousand won. Second, secondary teacher applicants spent about 420 thousand won for private education on average. The higher household income level was, the higher private education expenditure was. Private education expenditure for Hagwon cost statistically significantly higher than other exam preparation methods. The lower rank university graduates and private university graduates spent more on private education for exam preparation. Third, private education expenditure was not a significant determinant of probability of passing both primary and secondary teacher appointment exams. Particularly for secondary teacher appointment exams, graduates with higher college GPA, higher satisfaction of college education, and from higher rank university and public university were more likely to pass the exam. In conclusion, this study found private education expenditure, which is associated with the level of household income, was not a significant determinant and the teacher appointment exams in Korea worked on the basis of meritocracy.

Using donor funding to catalyse investment in malaria prevention in Ghana: an analysis of the potential impact on public and private sector expenditure

BackgroundAn estimated 1.5 billion malaria cases and 7.6 million malaria deaths have been averted globally since 2000; long-lasting insecticidal nets (LLINs) have contributed an estimated 68% of this reduction. Insufficient funding at the international and domestic levels poses a significant threat to future progress and there is growing emphasis on the need for enhanced domestic resource mobilization. The Private Sector Malaria Prevention (PSMP) project was a 3-year intervention to catalyse private sector investment in malaria prevention in Ghana.MethodsTo assess value for money of the intervention, non-donor expenditure in the 5 years post-project catalysed by the initial donor investment was predicted. Non-donor expenditure catalysed by this investment included: workplace partner costs of malaria prevention activities; household costs in purchasing LLINs from retail outlets; domestic resource mobilization (public sector financing and private investors). Annual ratios of projected non-donor expenditure to annualized donor costs were calculated for the 5 years post-project. Alternative scenarios were constructed to explore uncertainty around future consequences of the intervention.ResultsThe total donor financial cost of the 3-year PSMP project was USD 4,418,996. The average annual economic donor cost per LLIN distributed through retail sector and workplace partners was USD 21.17 and USD 7.55, respectively. Taking a 5-year post-project time horizon, the annualized donor investment costs were USD 735,805. In the best-case scenario, each USD of annualized donor investment led to USD 4.82 in annual projected non-donor expenditure by the fifth-year post-project. With increasingly conservative assumptions around the project consequences, this ratio decreased to 3.58, 2.16, 1.07 and 0.93 in the “very good”, “good”, “poor” and “worst” case scenarios, respectively. This suggests that in all but the worst-case scenario, donor investment would be exceeded by the non-donor expenditure it catalysed.ConclusionsThe unit cost per net delivered was high, reflecting considerable initial investment costs and relatively low volumes of LLINs sold during the short duration of the project. However, taking a longer time horizon and broader perspective on the consequences of this complex catalytic intervention suggests that considerable domestic resources for malaria control could be mobilized, exceeding the value of the initial donor investment.

DETERMINANTS OF NIGERIA GOVERNMENT AGRICULTURAL EXPENDITURE (1999-2020): EVIDENCE FROM VECTOR ERROR CORRECTION MODEL APPROACH

The study focused on the determinants of government agricultural expenditure in the long and short run from 1999-2020 using Vector Error Correction Model approach. Annual time series data on agricultural GDP, agricultural expenditure, inflation rate, exchange rate, interest rest, private investment, public investment and foreign direct investment collected from the records of Central Bank of Nigeria and National Bureau of Statistics database were analyzed using inferential statistics (ADF, Johansen co-integration and VECM). The results showed that all the variables co-integrate and were stationary at first difference. In the long run, inflation (1.118415) and private investment (0.004239) were the significant and important variables that determine agricultural expenditure. The coefficient of multiple determination (R2) was 0.925, indicating that 92.5% variation in agricultural expenditure was explained by the variables. The Error correction Term is statistically significant and negative (-0.0278) in the short run indicating a slow speed of adjustment of variables towards equilibrium. In the short run, inflation, private investment and public investment were the important variables that influenced government expenditure. The study concludes that inflation, private and public expenditures influenced government agricultural expenditure significantly and therefore recommend friendly policies to curtail inflation, conducive environment to catalyze private investment and stimulation of public investment to boost agricultural growth.

Health insurance coverage in low-income and middle-income countries: progress made to date and related changes in private and public health expenditure.

IntroductionSeveral low-income and middle-income countries (LMICs) have implemented health insurance programmes to foster accessibility to healthcare and reduce catastrophic household health expenditure. However, there is little information regarding the population coverage of health insurance schemes in LMICs and on the relationship between coverage and health expenditure. This study used open-access data to assess the level of health insurance coverage in LMICs and its relationship with health expenditure.MethodsWe searched for health insurance data for all LMICs and combined this with health expenditure data. We used descriptive statistics to explore levels of and trends in health insurance coverage over time. We then used linear regression models to investigate the relationship between health insurance coverage and sources of health expenditure and catastrophic household health expenditure.ResultsWe found health insurance data for 100 LMICs and combined this with overall health expenditure data for 99 countries and household health expenditure data for 89 countries. Mean health insurance coverage was 31.1% (range: 0%–98.7%), with wide variations across country-income groups. Average health insurance coverage was 7.9% in low-income countries, 27.3% in lower middle-income countries and 52.5% in upper middle-income countries. We did not find any association between health insurance coverage and health expenditure overall, though coverage was positively associated with public health spending. Additionally, health insurance coverage was not associated with levels of or reductions in catastrophic household health expenditure or impoverishment due to health expenditure.ConclusionThese findings indicate that LMICs continue to have low levels of health insurance coverage and that health insurance may not necessarily reduce household health expenditure. However, the lack of regular estimates of health insurance coverage in LMICs does not allow us to draw solid conclusions on the relationship between health insurance coverage and health expenditure.

Long-Term Health-Related Quality of Life in Non-Hospitalized Coronavirus Disease 2019 (COVID-19) Cases With Confirmed Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2) Infection in England: Longitudinal Analysis and Cross-Sectional Comparison With Controls.

BackgroundWe aimed to quantify the unknown losses in health-related quality of life of COVID-19 cases using quality-adjusted life days (QALDs) and the recommended EQ-5D instrument in England.MethodsProspective cohort study of non-hospitalised, PCR-confirmed SARSCoV2(+) cases aged 12-85 years and followed up for six months from 01 December 2020, with cross-sectional comparison to SARSCoV2() controls. Main outcomes were QALD losses; physical symptoms; and COVID-19-related private expenditures. We analysed results using multivariable regressions with post-hoc weighting by age and sex, and conditional logistic regressions for the association of each symptom and EQ-5D limitation on cases and controls.ResultsOf 548 cases (mean age 41.1 years; 61.5% female), 16.8% reported physical symptoms at month 6 (most frequently extreme tiredness, headache, loss of taste and/or smell, and shortness of breath). Cases reported more limitations with doing usual activities than controls. Almost half of cases spent a mean of £18.1 on non-prescription drugs (median: £10.0), and 52.7% missed work or school for a mean of 12 days (median: 10). On average, all cases lost 13.7 (95%-CI: 9.7, 17.7) QALDs, while those reporting symptoms at month 6 lost 32.9 (24.5, 37.6) QALDs. Losses also increased with older age. Cumulatively, the health loss from morbidity contributes at least 18% of the total COVID-19-related disease burden in England.ConclusionsOne in 6 cases report ongoing symptoms at 6 months, and 10% report prolonged loss of function compared to pre-COVID-19 baselines. A marked health burden was observed among older COVID-19 cases and those with persistent physical symptoms.

Counterfactual analysis among Covid-19: fiscal and monetary policy for green economic recovery

This study examines fiscal-monetary policy links in America across a time period that includes the recent global economic crisis and the COVID-19 emergency. Hypotheses deviate that regulatory administrations are permanent and calculate fiscal policy yearly percentage rate and budgetary regulations which are likely to change between two governments. Additionally, study uses the VAR technique to evaluate the effects of financial initiatives similar to those undertaken in the aftermath of the Covid-19 outbreak. Results discovered that fiscal policy is more successful than monetary policy, and that lavishing on public debt helps increase short-run economic performance. People argue that concerns about a rapid rise in prices as a result of fiscal stimulus are unfounded because the US economy was not close to full employment or full use of funds prior to the global epidemic, and the dissemination processes that could contribute to accelerating rising prices are not always in place. As a result, with the withdrawal of monetary stimulus, the favourable effects on actual GDP and real private expenditure are gone. Long-term mortgage rates have risen, money invested has decreased, and prices have risen, raising concerns about the banking system's inflationary tendency.

Switch from public to private retail pharmaceutical expenditures: evidence from a time series analysis in Italy

ObjectivesTo analyse trajectories of retail pharmaceutical expenditures from 2010 to 2019 in Italy to investigate whether there was a switch from public to private expenditure, how the composition of private...

Chinese consumer confidence: A catalyst for the outbound tourism expenditure?

This study performs the bootstrap full- and sub-sample rolling-window Granger causality tests, in order to investigate the time-varying causal relationship between the consumer confidence index (CCI) and the outbound tourism expenditure (OTM) in China. For this purpose, it introduces the variable of consumer confidence as a subjective psychological perception variable into the gravity model and explores its impact on the outbound travel. The results reveal that CCI tends to exert positive impacts on the OTM in most subsamples. That is to say that the Chinese consumer confidence can be considered as a catalyst for the OTM. However, the impact tends to be negative during times such as the global financial crisis, caused by the appreciation in the renminbi. In turn, OTM does not affect CCI. This suggests that the only change of private expenditure on outbound tourism cannot alter consumer confidence regarding the current economic and income situation. These findings compel the foreign tourism authorities to take CCI into account, especially when predicating the tourism arrivals from China, and hence plan their tourism strategy accordingly. Also, Chinese travel agencies should ideally take notice of the CCI in order to plan their international tour packages.

Health Care Expenditure in the European Union Countries: New Insights about the Convergence Process.

This paper assesses the convergence process in the health care expenditure for selected European Union (EU) countries over the past 50 years. As a novel contribution, we use bound unit root tests and, for robustness purposes, a series of tests for strict stationarity to provide new insights about the convergence process. We make a comparison between public and private health expenditure per capita and as a percentage of the gross domestic product (GDP), with a focus on six EU countries with different health care systems in place. When we consider the health expenditure per capita, we report mixed findings. We show that the spread from the group average is stationary in the cases of Finland and Portugal when the overall and public expenditure is considered. In terms of private expenditure, the convergence process is noticed only for Austria. For all other countries included in our sample, we document a non-stationary process, indicating a lack of convergence. This result is robust to the different tests we use. However, when we assess the convergence in terms of the health-expenditure-to-GDP ratio, the convergence process is recorded for Austria only. The robustness check we performed using strict stationarity tests partially confirmed the mixed results we obtained. Therefore, our findings highlight the heterogeneity of the EU health care systems and the need for identification of common solutions to the EU health care systems’ problems in order to enhance their convergence processes.

Public Investments and Class Gaps in Parents' Developmental Expenditures.

Families and governments are the primary sources of investment in children, providing access to basic resources and other developmental opportunities. Recent research identifies significant class gaps in parental investments that contribute to high levels of inequality by family income and education. State-level public investments in children and families have the potential to reduce class inequality in children's developmental environments by affecting parents' behavior. Using newly assembled administrative data from 1998-2014, linked to household-level data from the Consumer Expenditure Survey, we examine how public sector investment in income support, health and education is associated with the private expenditures of low and high-SES parents on developmental items for children. Are class gaps in parental investments in children narrower in contexts of higher public investment for children and families? We find that more generous public spending for children and families is associated with significantly narrower class gaps in private parental investments. Moreover, we find that equalization is driven by bottom up increases in low-SES households' developmental spending in response to the progressive state investments of income support and health, and by top down decreases in high-SES households' developmental spending in response to the universal state investment of public education.

Influence of Health Expenditure on COVID-19 Contraction: Theoretical and Empirical Analysis

Intensive economic development leads to the inevitable consequences of anthropogenic impact on the environment. Air pollution, soil degradation, water pollution and lack of clean drinking water lead to deteriorating human health and increasing the burden on the health care system. Globalization and integration have also become important drivers of the rapid spread of the COVID-19 pandemic. All this leads to the need to transform the health care system and the model of its financing, and adapt it to these challenges. The aim of this work is to identify theoretical (based on bibliometric analysis) and empirical (based on panel data regression modelling) patterns of the impact of health care expenditure on the effectiveness of the COVID-19 combating. The theoretical part of the work involves the implementation of bibliometric analysis based on 262 Scopus publications, in the title, keywords or annotations of which both concepts such as «health expenditure» and «COVID-19» are mentioned. The practical implementation of this task is carried out using VOSviewer v.1.6.17. According to the results of the bibliometric analysis, contextual, geographical and temporal patterns of publishing activity of scientists on certain issues were revealed. The empirical part of the work involves a statistical analysis to identify the relationship between morbidity and mortality due to COVID-19 and the volatility of the share of current health expenditure in GDP and its structure. The task of this stage is to determine the benchmarking model of financial support of the health care system, which demonstrates the greatest resistance to COVID-19. The analysis was conducted on the basis of data for 13 countries in Europe and Asia (Azerbaijan, Belarus, Armenia, Georgia, Estonia, Latvia, Lithuania, Moldova, Poland, Romania, Slovakia, Hungary and Ukraine). According to statistical analysis, the most resistant to COVID-19 is the health care system of Estonia, which is characterized by the volume of health care expenditure at 4-6% of GDP. At the same time, in the structure of the current health care expenditure, 25% is private expenditure and 75% is government expenditure, and external financing is almost non-existent. However, similar proportions of public and private expenditure in other countries do not ensure similar resistance to coronavirus, so this ratio is not a benchmark. A more in-depth analysis using panel regression modelling in Stata 12/SE revealed the positive impact of public, private and external health expenditures on reducing mortality, as well as the positive impact of increasing current health expenditures on life expectancy. The obtained theoretical and practical results can be useful for scientists and government officials in the context of optimizing the financial support of the health care system, taking into account its effectiveness in resisting national and global threats (COVID-19).

Health research publications by South African authors from 1996 to 2015: a bibliometric analysis.

Introductionresearch publications have a vital role in the scientific process, providing a strategic connection between the generation of new knowledge and its conversion into policy, practice, and positive health outcomes. There was a substantial increase in research funding in South Africa from the dawn of multi-party democracy in the mid-1990s to 2015. However, it is not known whether there was a corresponding increase in research publications from the country. Therefore, the objective of this bibliometric study was to assess trends and factors associated with health research publications from South Africa between 1996 and 2015.Methodsin July 2016, we searched Scopus for health science articles published between 01 January 1996 and 31 December 2015 with at least one author affiliated to an institution based in South Africa. We sought annual data on national-level indicators from Statistics South Africa and World Bank data. We used Poisson regression to examine trends in publication outputs and negative binomial regression to explore national-level factors associated with a change in the number of publications over time.Resultswe identified 51,133 publications, with a mean of 2,557 publications per year. Four universities (University of Cape Town, University of the Witwatersrand, Stellenbosch University, and the University of Pretoria) contributed more than half of the publications. The top destination journals were the South African Medical Journal (14.57% of the articles), PLoS ONE (5.77%), South African Family Practice (4.68%), Journal of the South African Veterinary Association (2.48%), and The Lancet (2.37%). The annual number of publications increased five-fold from 1133 in 1996, with an upsurge after 2003, to 5820 in 2015. The average annual percentage growth in the number of publications rose from 3.31% in 1996-2000 to 13.63% in 2011-2015. Year of publication (incidence rate ratio 1.16, 95% confidence interval 1.14 to 1.18) and annual private expenditure on health (incidence rate ratio 1.08, 95% confidence interval 1.05 to 1.10) were independent predictors of publication output.Conclusionthe number of health research publications from South Africa grew substantially between 1996 and 2015, with wide variation in output among universities. Private expenditure on health may be a proxy of health research funding, which probably explains its association with publication output in this study.

Impacts of Economic Freedom, Health, and Social Expenditures on Well-Being Measured by the Better Life Index in OECD Countries

ABSTRACT The Organization for Economic Co-operation and Development (OECD) has developed the Better Life Index (BLI), which is a multidimensional approach to well-being. This study aims to investigate the impact of health and social expenditures as well as the economic freedom index on well-being measured by BLI among 34 OECD countries for 2013–2017 period. We estimated panel models to observe the social and health expenditure effects according to their sources and the overall impact of economic changes among countries. We find that public and private social expenditures have a positive and statistically significant impact on BLI at 1% significance level. Additionally, whereas public health expenditure has a positive and statistically significant impact on BLI at 1% significance level, the effects of private health expenditure are statistically significant at 10% significance level. The economic freedom index has a positive and statistically significant impact on BLI in both models. Both social and health expenditures should take a prominent position in policy debates for a better life.

The Effect of Private and Public Health Expenditure on Economic Growth in Sub-Saharan Africa

This study examined the relationship between health expenditure and economic growth in sub-Saharan Africa. The General Method of Moments (GMM) estimation technique was used and the data covered the period 2000-2019 for forty-six countries. The results of the difference GMM-1 and GMM-2 steps indicate that a 1% change in public health expenditure per capita (LPUHE_PC) is associated with a 0.1362% and 0.1521% rise in GDP per capita (GDP_PC) in the short run. The system GMM-1 and GMM-2 steps indicate that a percentage change in LPUHE_PC is associated with a respective 0.0148% and 0.0109% rise in GDP_PC in the short run at a 1% level of significance, on average ceteris paribus. In the long run, the difference GMM-2 step indicates that a 1% change in the LPUHE_PC has a larger positive effect on the GDP_PC (1.34899%) than in the short-run (0.1521%). The result of the system GMM-1 and GMM-2 step indicates that a 1% change in LPUHE_PC has a larger positive effect on the GDP_PC in the long run (0.39967% and 0.24135%) than in the short-run (0.0148% and 0.0109%) respectively. This analysis indicates that a rise in government health spending will stimulate economic growth with a larger effect in the long run than in the short run in Sub-Saharan Africa. Thus, the government should increase health budgetary allocations.

Changes in Consumption Expenditures among Baby-boomers and Young-olds: Latent Transition Analysis

The aim of this study was to examine the longitudinal transition of consumption expenditures among both baby-boomers and young-olds in South Korea. We used data from the 6th (2016) and the 7th (2018) waves of the Korean Longitudinal Study of Ageing (KLoSA). The final sample comprised 1,806 baby-boomers (age range=53-61 in 2016) and 1,483 young-olds (age range=65-74 in 2016). Consumption expenditures were observed with nine types of expenses: food, eating out, public education, private education, housing, health-care, clothing, cultural entertainment, and savings. According to the results from latent transition analysis (LTA), three consumption subgroups were identified among baby-boomers: “non-expenditure for education (NE, 69.7%)” group, “high-public education expenditures (PE, 10.7%)” group, and “high-public and private education expenditures (PPE, 19.6%)” group. For baby-boomers, NE and PE were more likely to remain the same type throughout the two waves, and PPE was most likely to move to NE two years later. Meanwhile, the consumption expenditures of young-olds were divided into “low-saving (LS, 63.7%)” group, “high-saving (HS, 40%)” group, and “education cost-centered (EC, 5.3%)” group. In the case of young-olds, the transition between the groups was unlikely to occur across the two waves which can be interpreted as having fewer life cycle changes than baby-boomers. This study suggests that it is necessary to take into account the difference between the generations when understanding longitudinal transition of consumption expenditures.

Projected private hospital expenditure in Ireland, 2018-2035: What role for demographics, cost, and Sláintecare?

Despite private hospitals occupying an important role in the delivery of acute hospital care in Ireland, an understanding of future spending pressures on these services is limited. Particularly, a key dimension of Ireland's ambitious roadmap for healthcare reform (Sláintecare) seeks to remove private practice from public hospitals. However, to date, there has been no examination of how this reform could impact private hospital demand and expenditure, and ultimately, the capacity to treat public patients. Using previously unavailable administrative health insurer data and a healthcare macro-simulation projection model, we project real (volume-based) and nominal expenditure on private hospital services over the medium-term (2018-2035). We develop a number of projection scenarios that vary assumptions in relation to population growth and ageing, healthy ageing, and the future cost of care delivery. Additionally, by developing profiles of private activity in public hospitals, we examine how the removal of private practice from public hospitals could impact on demand and expenditure in private hospitals over time. Findings from this analysis have implications for capital investment and workforce planning in private hospitals, and failure to meet future demand could have implications for access to care in public hospitals. Moreover, should private practice be ended in public hospitals, most complex private in-patient and emergency care is likely to remain within the public hospitals with limited capacity benefits for the public system.

The COVID-19 consumption game-changer: Evidence from a large-scale multi-country survey

Prospective economic developments depend on the behavior of consumer spending. A key question is whether private expenditures recover once social distancing restrictions are lifted or whether the COVID-19 crisis has a sustained impact on consumer confidence, preferences, and, hence, spending. The elongated and profound experience of the COVID-19 crisis may durably affect consumer preferences. We conducted a representative consumer survey in five European countries in summer 2020, after the release of the first wave’s lockdown restrictions, and document the underlying reasons for households’ reduction in consumption in five key sectors: tourism, hospitality, services, retail, and public transports. We identify a large confidence shock in the Southern European countries and a shift in consumer preferences in the Northern European countries, particularly among high-income earners. We conclude that the COVID-19 experience has altered consumer behavior and that long-term sectoral consumption shifts may occur.