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Does individual behavior converge to policy recommendations in times of pandemic? Evidence from COVID-19 in US states

Robert J. Sonora orcid.org/0000-0003-4713-7082 ; Faculty of Economics and Business, University of Zagreb
Martina Gottwald-Belinić ; Faculty of Economics and Business, University of Zagreb

Abstract

The COVID-19 pandemic is an exceptional shock on human habitual behavior and provides a rare opportunity to analyze resilience in preferences. We use Google's mobility and policy stringency indices to investigate if policy maker and resident „preferences" align over the period. Differences in utility across the ten largest states in the United States should lead to idiosyncratic response on perceived cost of restrictions and associated risk attitudes in policy respond. We conduct structural break and rolling unit root tests on estimated residual. Our results suggest that individual behavior converges to the policy prescriptions within the time span up to 18 months.

Keywords

COVID-19; individual risk behavior; structural break; unit root tests

Hrčak ID:

303514

URI

https://hrcak.srce.hr/303514

Publication date:

5.6.2023.

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