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Europe > Latvia, Republic of

You are looking at 1 - 5 of 5 items for :

  • Type: Journal Issue x
  • Macroeconomics: Consumption; Saving; Wealth x
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Cover IMF Working Papers
Far More Than a Shot in the Arm: Vaccines and Consumer Spending
Mr. Serhan Cevik
The spread of the COVID-19 pandemic and government interventions have reshaped economic activity with abrupt changes in household consumption behavior across the world. This paper provides an empirical investigation of how the COVID-19 vaccine rollout has affected consumer spending at daily frequency using debit and credit card transactions in three European countries. Empirical results show that COVID-19 vaccinations, along with other policy interventions, have mitigated the severe negative impact of the pandemic and boosted consumer spending. First, the vaccination deployment has a statistically and economically significant positive effect on private consumption. Second, other policy responses to the pandemic—designed to contain the spread of the virus and provide support to businesses and households—have significant effects on the amount and composition of debit and credit card transactions. Third, the impact of COVID-19 vaccinations in terms of stimulating consumer spending appears to be more pronounced on contact-intensive sectors such as services than goods.
Keywords:
Pandemic; COVID-19; vaccination; household behavior; consumer spending; card transactions; Baltics; Estonia; Latvia; Lithuania; vaccine rollout; credit card transactions; vaccination deployment; government intervention; vaccination effort; Consumer credit; Household consumption
Cover IMF Working Papers
Show Me the Money: Tracking Consumer Spending with Daily Card Transaction Data During the Pandemic
Mr. Serhan Cevik
The COVID-19 pandemic has been an unprecedented shock to economic activity with abrupt and unexpected changes in household consumption behavior. This paper investigates how the spread of the pandemic and government interventions have affected consumer spending using daily card transaction data in the Baltics. The analysis shows significant effects on the amount and composition of debit and credit card transactions. First, the number of new COVID-19 infections or deaths has a strongly negative effect. Second, while public health measures designed to contain the spread of the pandemic has a negative effect, economic support measures designed to assist businesses and households have a stimulative effect. Third, there is heterogeneity across spending categories, but the drop is mostly concentrated in sectors that are restricted by lockdowns and the risk of infection. Fourth, the impact of government interventions, especially in terms of stimulating consumer spending, appears to be more pronounced on goods than services.
Keywords:
Pandemic; consumer spending; card transactions; Baltics; Estonia; Latvia; Lithuania; euro area; transition economies; household consumption behavior; credit card transactions; stimulating consumer spending; government intervention; consumer spending pattern; credit card transaction data; COVID-19; Consumer credit; Consumption; Household consumption
Cover IMF Staff Country Reports
Republic of Lithuania: Selected Issues Paper
International Monetary Fund
This Selected Issues Paper quantifies the variability of tax elasticities in Lithuania using two alternative methods: rolling regressions and pooled mean group estimator. The analysis is motivated by the systematic variation of tax revenues observed over the economic cycle. Both methods confirm that tax elasticities moved with the cycle, which can be attributed to the procyclical tax compliance tendencies and structural composition effects across tax bases. The results of the study emphasize the importance of accounting for cyclical variation in tax elasticities when making short-term tax revenue projections.
Keywords:
ISCR; CR; crisis; GDP; Latvia; investment ratio; trading partner growth; revenue gap; employment participation ratio; FDI flow; Tax elasticity; Value-added tax; Personal income; Private consumption; Baltics; Eastern Europe; Asia and Pacific
Cover IMF Working Papers
Assessing the Risk of Private Sector Debt Overhang in the Baltic Countries
Ms. Valerie Herzberg
Between 2000 and 2007 nonfinancial private sector credit expanded rapidly in the Baltic countries, resulting in a non-negligible build-up of debt. Could this legacy debt hold back the economic recovery of the region? This paper analyzes the setting in each of the three countries and, with the help of an experimental Debt Overhang Index (DOI), draws tentative conclusions for domestic demand.
Keywords:
WP; debt; Latvia; Estonia
Cover IMF Working Papers
Finance and Convergence: What’s Ahead for Emerging Europe?
Mr. Philip Schellekens
and
Mr. Rudolfs Bems
This paper singles out the key short-term risks and medium-term challenges related to finance and convergence in emerging Europe. With the help of a general equilibrium theoretical framework, the paper identifies pragmatic directions for policymakers. While the "speed limits" to capital inflows may be hard to determine, the costs of breaking them are likely substantial. To ensure "safe driving," policymakers ought to build buffers and reduce vulnerabilities. Equally important, yet often overlooked, is the need to prepare for "the curve ahead"-the reversal of external current account imbalances. To avoid painful adjustments, flexible factor markets and strong financial systems will be more important than ever.
Keywords:
WP; current account; interest rate; open economy