Governments require regional or national lockdowns in order to prevent the spread of COVID-19, which causes large economic stagnation in wide areas because the declines of the lockdowns diffuse to other regions through supply chains. This study examines how governments mitigate the economic losses when they are obliged to implement lockdowns , using supply-chain data for 1.6 million firms in Japan. We find that the coordinated, i.e., simultaneous, lockdowns have less GDP losses than the incoordinated lockdownsthrough the test of all combinations of two-region lockdowns . Furthermore, we test practical scenarios in which  47 regions are imposed lockdowns in three months and find that if nation-wide lockdowns are coordinated , the GDP losses are less than the uncoordinatedlockdowns .
In order to prevent the spread of COVID-19, governments have often required regional or national lockdowns, which have caused extensive economic stagnation over broad areas as the shock of the lockdowns has diffused to other regions through supply chains. Using supply-chain data for 1.6 million firms in Japan, this study examines how governments can mitigate these economic losses when they are obliged to implement lockdowns . Through tests of all combinations of two-region lockdowns, we find that coordinated, i.e., simultaneous, lockdowns yield smaller GDP losses than uncoordinated lockdowns . Furthermore, we test practical scenarios in which Japan's 47 regions impose lockdowns over three months and find that GDP losses are lower if nationwide lockdowns are coordinated than if they are uncoordinated .
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