Download This PaperHabits and Demand Changes after COVID-19
62 Pages Posted: 2 Nov 2022
Abstract
In this paper, we investigate how a transitory lockdown of a sector of the economy may have changed our habits and, therefore, altered the goods’ demand permanently. In a two-sector infinite horizon economy, we show that the demand of the goods produced by the sector closed during the lockdown could shrink or expand with respect to their pre-pandemic level depending on the lockdown’s duration and the habits’ strength. We also show that the end of a lockdown may be characterized by a price surge due to a combination of strong demand of both goods and rigidities in production.
Keywords: E21, E30, E60, I18
Suggested Citation: Suggested Citation
Gozzi, Fausto and Bambi, Mauro and Ghilli, Daria and Leocata, Marta, Habits and Demand Changes after COVID-19. Available at SSRN: https://ssrn.com/abstract=4260114 or http://dx.doi.org/10.2139/ssrn.4260114
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