State Capacity in Responding to COVID-19

This study investigates the link between state capacity and deaths from Covid-19. We examine the effects on the Covid-19 case fatality rates of state capacity across countries with an ordered probit estimation controlling for the level of democracy, government policy responses, the share of the elderly population, and health system resource capacity. The study presents strong evidence for the critical role of state capacity in achieving positive policy outcomes. The effect of government effectiveness on the Covid-19 death level is consistently negative and statistically significant, suggesting that increased government effectiveness is significantly associated with decreased Covid-19 fatality rates. The findings also show that in the models controlling for government effectiveness and the testing and stay at home policies, non-free countries are more likely to have lower death levels than free countries. The effects of the testing and stay at home policies have expected negative signs. Higher health system capacity represented by higher numbers of hospital beds and doctors is more likely to lower a country's case fatality rate. A higher proportion of the elderly population is associated with higher levels of death from Covid-19.