US policy makers responded to the Covid-19 epidemic by providing $1.8 trillion in private sector bailouts. We collect data on all bailouts for publicly-listed firms, document empirical facts of the bailout programs and discuss policy implications. More than three quarters of bailout firms have either cash holdings or past dividends and share buybacks larger than their bailouts, suggesting that they might have been able to produce these funds internally. A surprisingly large fraction of the bailout recipients are start-up like firms, for which the bailouts appear to be a windfall. The effective tax rate of bailed out firms is 4%. This is the first paper to collect and analyze data on the Covid-19 bailouts.
Lead investigator: | Jean-Marie Meier |
Affiliation: | University of Texas at Dallas |
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Start date | 1/2020 |
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