Business Investment during the Pandemic in Colombia 2020-2021

Abstract

Applying Tobit models, it is evident that during the period of the pandemic, March 2020-September 2021, the behavior of investment and development (not digital) in 59 Colombian business sectors was mainly determined by seven variables: positively influenced  by investment in digital solutions, increase in staff working at home, decrease in firms cash flow, on the contrary, investment was negatively affected by the reduction in liquidity and difficult access to financial services (shortage of credit), expenditure on goods and new and improved processes and the hope given by government support policies. It is important to note that expectations regarding the behavior of the Colombian economy in the following year were not significant. The degree of the impact of the covid19 was differential between sectors intensive in technology and unskilled labor.