BICEPS/SSE Riga Research Seminar: Did Job Retention Schemes Save Jobs during the COVID-19 Pandemic? Firm-level Evidence from Latvia

We invite you to a BICEPS/SSE Riga research seminar, which will take place on Thursday, October 27, at SSE Riga, room 611. 

We are delighted to welcome Konstantins Benkovskis (Bank of Latvia and SSE Riga) as the speaker. Konstantins is an advisor to the Monetary Policy Department at the Bank of Latvia and an Associate Professor at SSE Riga. His main research interests include international trade, non-price competitiveness, global value chains, productivity and resource allocation. Konstantins is the Board Member of the Baltic Economic Association and the Editor of the Baltic Journal of Economics.

Speaker: Konstantins Benkovskis (Bank of Latvia and SSE Riga)

Title: Did Job Retention Schemes Save Jobs during the COVID-19 Pandemic? Firm-level Evidence from Latvia (co-authored with Olegs Tkacevs and Karlis Vilerts, Bank of Latvia)

Time: Thursday, October 27, 17:00

Venue: SSE Riga, room 611

Abstract

The study examines the impact of participation of Latvia’s firms in the Job retention scheme (JRS) on firm employment during the covid-19 pandemics. It focuses on the idle-time allowances paid out during the first wave of the pandemics (in Spring 2020) and their employment effects until the beginning of the second wave (in Autumn 2020). It uses novel firm-level dataset at monthly frequency and applies difference-in-difference estimation to track employment dynamics over time in firms that participated in JRS versus firms that did not participate. The estimation results indicate that the employment effect of JRS participation was positive and statistically significant, i.e. participating firms managed to keep their employees and resume their economic activity faster than similar non-participating firms. The effect comes both from reducing the probability of becoming inactive, as well as from higher growth of the number of employees for firms that remained active. The effect appears particularly strong in sectors with a higher share of highly skilled employees and sectors with relatively low level of interpersonal contact. The allocation effect of JRS is ambiguous and is subject to further investigation.

No prior registration for the seminar is necessary. For any questions about the seminar, or if you have a colleague that would like to be added to the distribution list, please write to Nicolas Gavoille.