The Unequal Consequences of the Covid‐19 Pandemic: Evidence from a Large Representative German Population Survey

• Published date: 01 June 2022
• Author: Lea Immel,Florian Neumeier,Andreas Peichl
• Date: 01 June 2022
• DOI: http://doi.org/10.1111/roiw.12571

© 2022 The Authors. Review of Income and Wealth published by John Wiley & Sons Ltd on behalf of

International Association for Research in Income and Wealth

471

THE UNEQUAL CONSEQUENCES OF THE COVID- 19 PANDEMIC:

EVIDENCE FROM A LARGE REPRESENTATIVE GERMAN

POPULATION SURVEY

by Lea ImmeL

ifo Institute and University of Munich

AND

FLorIan neumeIer and andreas PeIchL*

ifo Institute, University of Munich and CESifo

We use panel data from three waves of a large representative population survey carried out between

June and November 2020 to assess in what regards and to what extent different groups of the German

population are affected by the COVID- 19 crisis. Using common factor analysis, we show that people’s

lives are mainly affected in two ways: First, a notable fraction of the population is concerned that they

or their family members and friends may get infected with the coronavirus. Second, many people suffer

from socio- economic consequences of the crisis, including a discontinuation of employment, a decrease

in household income, and worries about financial troubles. Regressing these two factors on several

socio- demographic characteristics reveals that especially the socio- economic consequences vary across

population groups. Self- employed persons, marginally employed workers, low- income households, and

families with children appear to be burdened overproportionally.

JEL Codes: I10, I14, I18, J11, J20

Keywords: corona, COVID- 19, crisis, pandemic, inequality, Germany

1. IntroductIon

In 2020, the COVID- 19 pandemic quickly spread across the globe and pre-

sented unprecedented challenges to societies in dealing with its health, social, and

economic consequences. To contain the spread of the pandemic, governments

around the world implemented measures that severely disrupted economic and

social life, including contact restrictions, curfews, as well as the closure of busi-

nesses, schools, public facilities, and the prohibition of mass events. These inter-

ventions as well as the pandemic itself affect people’s lives in different ways: their

Note: This research includes work funded by the German Federal Ministry of Health (CORONA-

BUND survey). The work was performed independently by the authors and on their own responsibility.

The views expressed in this paper are those of the authors. We are grateful to Manfred Güllner, Ute

Müller, and the team of forsa for collecting the data and their assistance regarding the survey design.

We thank Conchita D’Ambrosio (the editor), two anonymous referees, as well as Florian Dorn,

Clemens Fuest, and Marc Stöckli for comments on earlier drafts. Pascal Zamorski provided excellent

research assistance.

*Correspondence to: Andreas Peichl, ifo Institute, Leibniz Institute for Economic Research,

University of Munich e.V., Poschingerstr. 5, Munich D- 81679, Germany (peichl@ifo.de).

Review of Income and Wealth

Series 68, Number 2, June 2022

DOI: 10.1111/roiw.12571

This is an open access article under the terms of the Creat ive Commo ns Attri butio n- NonCo mmerc

ial- NoDerivs License, which permits use and distribution in any medium, provided the original work

is properly cited, the use is non- commercial and no modifications or adaptations are made.

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Review of Income and Wealth, Series 68, Number 2, June 2022

472

© 2022 The Authors. Review of Income and Wealth published by John Wiley & Sons Ltd on behalf of

International Association for Research in Income and Wealth

physical and mental health, working lives and economic situation, economic secu-

rity, educational careers, and social relationships, among others.

This paper pursues three goals: First, we aim to shed light on the question how

and in what dimensions the COVID- 19 pandemic affects people’s lives. Second, we

analyze whether different groups of society have been affected by the consequences

of the pandemic more severely than others, a question that is up to date under-

studied in the literature. Third, we want to assess whether the extent to which these

different subgroups were affected by the pandemic varies over its course. To this

end, we use data from a self- designed panel survey of German households carried

out at three points in time in 2020. The survey includes a series of questions elic-

iting how survey respondents were affected by the pandemic. More precisely, the

survey elicits how the spread of the COVID- 19 pandemic has affected the German

population economically, socially, and emotionally. The sample comprises about

30,000 representatively selected persons aged 18 or above who were surveyed in

three waves at different phases of the pandemic. The first survey wave took place

in June 2020 during a period of low infection rates and relaxing restrictions. The

second survey wave was carried out in October 2020 at a time when infection rates

rose sharply. The third survey wave was conducted in November 2020 shortly after

new restrictions on public and private life had been introduced.

The survey contains ten items eliciting whether, in which regard, and to what

extent respondents were affected by the COVID- 19 pandemic and the containment

measures imposed by the German government. For instance, the respondents were

asked whether they or their family members were tested positive for the coronavi-

rus, whether they were released from their job as a consequence of the COVID- 19

crisis, whether the pandemic affected their household income, how stressful they

perceive the restrictions of public life to be, and how their social contacts have

changed. In a first step, we apply common factor analysis to identify in what

regards people are mainly affected by the pandemic based on common variation

in these items. In a second step, we regress the factors we retrieve on a number

of socio- demographic characteristics to draw conclusions about the differential

impact of the pandemic by population groups.

The results of the factor analysis suggest that the consequences the pandemic

has on people’s lives can be summarized by two common factors: The first factor is

related to respondents’ concerns that they or their family members get infected. The

second factor is related to burdens due to restrictions on public life and contacts,

job loss, a decrease in household income, and financial concerns. Consequently, we

label the first factor Concern about Infection and the second one Socio- Economic

Strain.

Regressing these two common factors on socio- demographic and household

characteristics reveals that the COVID- 19 crisis has indeed differential effects on

different population groups— with regard to both the intensity with and the dimen-

sions in which people are affected. In particular, we find that women are more

affected by the pandemic than men. In all three survey waves, they are more con-

cerned about infections and also suffer from the adverse socio- economic conse-

quences of the pandemic to a greater extent.

Two concerning findings are that socio- economic strain is inversely related to

household income and that the adverse economic effects are larger for families with