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Annual Review of Financial Economics

Volume 15, 2023

Household Behavior (Consumption, Credit, and Investments) During the COVID-19 Pandemic

Abstract

The 2020 COVID-19 pandemic led to a large number of studies in household finance, using new high-frequency data in close to real time. In this article, we survey household behavior during the pandemic, with a focus on consumption, government policies, credit, and investment. The pandemic induced a rapid decline in consumption, which was affected by but largely preceded stay-at-home orders and was followed by a rapid rebound. Government stimulus was less effective in 2020 relative to other recessions, which is consistent with both shutdowns and precautionary savings. Delinquency rates fell, unlike in other recessions, likely due to government debt relief policies. Household investment behavior was affected by pandemic-induced changes in beliefs. We conclude by discussing avenues for future research.

Keyword(s): consumption, COVID-19, household finance, JEL D12, JEL E21, JEL G51, stimulus
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/content/journals/10.1146/annurev-financial-110821-020744
2023-11-01
2024-05-08
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/content/journals/10.1146/annurev-financial-110821-020744
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Household Behavior (Consumption, Credit, and Investments) During the COVID-19 Pandemic
Annual Review of Financial Economics 15, 91 (2023); https://doi.org/10.1146/annurev-financial-110821-020744
/content/journals/10.1146/annurev-financial-110821-020744
/content/journals/10.1146/annurev-financial-110821-020744
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