No abstract

A shelter‐in‐place order (SIPO) is one of the most restrictive non‐pharmaceutical interventions designed to curb the spread of COVID‐19. On March 19, 2020, California Governor Gavin Newsom issued the first statewide SIPO in the United States. The order closed non‐essential businesses and required residents to shelter in place for all but essential activities such as grocery shopping, retrieving prescriptions from a pharmacy, or caring for relatives. This study is the first in the economics literature to estimate the effect of a statewide SIPO on public health. Using daily state‐level coronavirus data and a synthetic control research design, we find that California's statewide SIPO reduced COVID‐19 cases by 160.9 to 194.7 per 100,000 population by April 20, one month following the order. We further find that California's SIPO led to as many as 1,566 fewer COVID‐19 deaths during this period. Back‐of‐the‐envelope calculations suggest that there were about 649 to 703 job losses per life saved, and about 14 to16 job losses per case averted during this post‐treatment period.

Large in‐person gatherings of travelers who do not socially distance are classified as the “highest risk” for COVID‐19 spread by the Centers for Disease Control and Prevention (CDC). From August 7–16, 2020, nearly 500,000 motorcycle enthusiasts converged on Sturgis, South Dakota for its annual rally in an environment without mask‐wearing requirements or other mitigating policies. This study is the first to explore this event's public health impacts. First, using anonymized cell phone data, we document that foot traffic at restaurants/bars, retail establishments, and entertainment venues rose substantially at event locations. Stay‐at‐home behavior among local residents fell. Second, using a synthetic control approach, we find that the COVID‐19 case rate increased substantially in Meade County and in the state of South Dakota in the month following the Rally. Finally, using a difference‐in‐differences model to assess nationwide spread, we find that following the Sturgis event, counties outside of South Dakota that contributed the highest inflows of rally attendees experienced a 6.4–12.5% increase in COVID‐19 cases relative to counties without inflows. Our findings highlight that local policy decisions assessing the tradeoff between local economic benefits and COVID‐19 health costs will not be socially optimal in the presence of large contagion externalities.