Subnational Income, Growth, and the COVID-19 Pandemic
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Published by Oxford University Press on behalf of the World Bank
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Using real-time data and machine-learning methods, we produce monthly aggregates on gross national income (GNI) for 147 Pakistani districts between 2012 and 2021. We use them to understand whether and how the COVID-19 pandemic affected Pakistan's growth and subnational income distribution. Three findings emerge from our analysis. First, districts experienced a sizable decline in income during the pandemic, as their monthly growth rate dropped on average by 0.133 percentage points. Second, a larger income drop occurred in districts with a higher COVID-19 incidence, corresponding to urban areas characterized by a higher population density. Third, COVID-19 caused a decline in income inequality across districts, with more affluent districts experiencing more negative income growth during the pandemic.