Economic impact of covid-19 on small and medium businesses under voluntary and imposed restrictions

Abstract

Objectives: the paper analyzes the impact that covid-19 has had on expenditures, sales, expectations, perceptions of government policies, remedial measures, and adaptation to the crisis of the small and medium-sized service and commercial firms (sme) in the Metropolitan Area of Aguascalientes, Mexico. Methodology: Description of the survey results, non parametric tests, estimation of the transition matrix, and regression analysis. Results: Evidence of a) a dramatic drop in income in the face of a certain inflexibility towards the reduction of expenditures, b) dissimilar strategies that firms adopt to cope with the crisis, c) negative expectations of a soon return to normality. Limitations and implications: Difficulty in identifying causality and generalization of the results. Originality and value: Extended survey that characterizes the economic situation and expectations prior to and during the covid-19 pandemic in Mexico. Conclusions: Many smes will be in a compromised economic situation in the present and near future, and we highlight the need to develop policies and strategies that improve their possibilities of survival.   Recepción: 19/10/2020 Aceptación: 28/01/2021