Working Paper: NBER ID: w28291
Authors: Michael Lokshin; Vladimir Kolchin; Martin Ravallion
Abstract: The paper formalizes and tests the hypothesis that greater exposure to big shocks induces stronger societal responses for adaptation and protection from future big shocks. We find support for this hypothesis in various strands of the literature and in new empirical tests using cross-country data on deaths due to COVID-19 and deaths during World War 2. Countries with higher death rates in the war saw lower death rates in the first wave of the COVID pandemic, though the effect faded in the pandemic’s second wave. Our tests are robust to a wide range of model specifications and alternative assumptions.
Keywords: COVID-19; World War II; big shocks; societal responses; adaptation; protection
JEL Codes: D02; D74; I12; N10
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| greater exposure to significant historical shocks (N23) | stronger societal investments in adaptation and protection against future shocks (H12) |
| COVID-19 outcomes (I14) | willingness to comply with public health measures (I18) |
| historical experiences (B15) | compliance with public health measures (I18) |
| WWII death rates (H56) | COVID-19 outcomes (I14) |
| WWII death rates (H56) | COVID-19 mortality during the pandemic's first wave (I14) |