support in the following period. Interestingly, firms that continued to receive government support in the second round performed no better or even worse than those that did not receive any support. Also, firms that received government support only in the second round experienced no performance boost compared to those that received no support. These results hold up through various robustness checks, including controlling for firm performance in Rounds 1 and 2. Our findings suggest that, for effective policy, government support should be provided to firms quickly without delay, but it should also be phased out quickly.

The paper is organized as follows. Section 2 presents the data and summary statistics. Section 3 describes the empirical strategy. Section 4 discusses the main results. Section 5 includes several robustness checks, and Section 6 concludes.

# **2. Data and Summary Statistics**

We use data from ES COVID-19 Follow-up Surveys to capture government support received by firms during the COVID-19 pandemic and to measure firm performance.<sup>2</sup> The World Bank has collected one to three rounds of these surveys in 45 countries starting in May 2020.<sup>3</sup> To explore how government support was repeated over time, we use data for countries with three survey rounds as of May 9, 2022. We conduct our analysis on a sample of 15 emerging markets and developing countries in ECA to focus on a homogeneous environment (see Table A.1 in the Appendix).<sup>4</sup> The three rounds of surveys were completed between May 2020 and April 2022 for this sample of 15 countries.<sup>5</sup> The sampling frame for the ES COVID-19 Follow-up Surveys includes all firms that replied to the latest pre-COVID-19 ES, making it possible to link performance during the COVID-19 pandemic back to firm characteristics collected through the ES. The ES cover formal (registered) firms with five or more employees and are designed to be nationally representative for the manufacturing and service sectors. For the countries in our sample, the most recent ES was conducted in 2019 or early 2020.<sup>6</sup> The ES COVID-19 Follow-up Surveys include questions on government support received during the pandemic. They also ask firms about changes in performance during the crisis, as well as expectations for the next months. Table A.2 provides the definitions of the variables included in our analysis. Tables 1 and 2 present the summary statistics of the share of firms that received government support and when they did so. Table 3 presents the summary statistics on firm characteristics and performance.

> 2 More information on the ES COVID-19 Follow-up Surveys is available at https://www.enterprisesurveys.org/en/covid-19.

> 3 Four rounds of data were collected in Jordan.

> 4 At least three rounds of survey data are also available for 3 countries in the Middle East and North Africa, 2 countries in Sub-Saharan Africa, and 4 countries in high-income Europe and Central Asia.

> 5 Armenia and North Macedonia have later Rounds 2 and Rounds 3 compared to the other 13 countries in our sample. Our results in this paper are robust for a sub-sample of 13 countries which drops Armenia and North Macedonia from the original sample.

> 6 For most countries, the surveys were completed before March 2020. For Romania, 92 percent of the interviews were completed before March 2020. Our results are similar when we exclude the 8 percent of observations from Romania that were collected in or after March 2020.

3