Small Businesses, Information Frictions, and the Effectiveness of Government Responses to Covid-19

Collaborating with co-authors at Princeton and Oxford, Professor Humphries' research project has two objectives. First, to collect new longitudinal survey data on the impacts of the Covid-19 crisis on small businesses, their expectations about the future and the utilization of government assistance programs targeting small businesses. This information provides important descriptive insights into how small businesses have been impacted and evidence about the role of information frictions in their utilization of government assistance. Survey data has been collected in nine Latin American countries: Argentina, Peru, Chile, Colombia, Mexico, Ecuador, Brazil, and the Dominican Republic. Second, the project is conducting a randomized experiment in each of the Latin American countries to investigate how access to different forms of information impact business owners' use of government economic relief programs, and if participation in such programs affects future business decisions such as laying off workers or closing.