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. 2022 Aug 24;17(8):e0272208.
doi: 10.1371/journal.pone.0272208. eCollection 2022.

A cross-country analysis of macroeconomic responses to COVID-19 pandemic using Twitter sentiments

Zahra Movahedi Nia  1   2 , Ali Ahmadi  3   4 , Nicola L Bragazzi  1   2 , Woldegebriel Assefa Woldegerima  1   2 , Bruce Mellado  1   5 , Jianhong Wu  1   2 , James Orbinski  1   6 , Ali Asgary  1   4 , Jude Dzevela Kong  1   2
Affiliations

A cross-country analysis of macroeconomic responses to COVID-19 pandemic using Twitter sentiments

Zahra Movahedi Nia et al. PLoS One. .

Abstract

The COVID-19 pandemic has had a devastating impact on the global economy. In this paper, we use the Phillips curve to compare and analyze the macroeconomics of three different countries with distinct income levels, namely, lower-middle (Nigeria), upper-middle (South Africa), and high (Canada) income. We aim to (1) find macroeconomic changes in the three countries during the pandemic compared to pre-pandemic time, (2) compare the countries in terms of response to the COVID-19 economic crisis, and (3) compare their expected economic reaction to the COVID-19 pandemic in the near future. An advantage to our work is that we analyze macroeconomics on a monthly basis to capture the shocks and rapid changes caused by on and off rounds of lockdowns. We use the volume and social sentiments of the Twitter data to approximate the macroeconomic statistics. We apply four different machine learning algorithms to estimate the unemployment rate of South Africa and Nigeria on monthly basis. The results show that at the beginning of the pandemic the unemployment rate increased for all the three countries. However, Canada was able to control and reduce the unemployment rate during the COVID-19 pandemic. Nonetheless, in line with the Phillips curve short-run, the inflation rate of Canada increased to a level that has never occurred in more than fifteen years. Nigeria and South Africa have not been able to control the unemployment rate and did not return to the pre-COVID-19 level. Yet, the inflation rate has increased in both countries. The inflation rate is still comparable to the pre-COVID-19 level in South Africa, but based on the Phillips curve short-run, it will increase further, if the unemployment rate decreases. Unfortunately, Nigeria is experiencing a horrible stagflation and a wild increase in both unemployment and inflation rates. This shows how vulnerable lower-middle-income countries could be to lockdowns and economic restrictions. In the near future, the main concern for all the countries is the high inflation rate. This work can potentially lead to more targeted and publicly acceptable policies based on social media content.

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Conflict of interest statement

The authors have declared that no competing interests exist.

Figures

Fig 1
Fig 1. Phillips curve.
The long-run and short-run Phillips curves.
Fig 2
Fig 2. Confusion matrix.
The confusion matrix of the sentiment analysis model.
Fig 3
Fig 3. Phillips curve.
Phillips curve of Canada and South Africa.
Fig 4
Fig 4. Phillips curve.
Phillips curve of Canada, South Africa, and Nigeria.
See this image and copyright information in PMC

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