  This paper develops a methodology for tracking in real time the impact of
shocks (such as natural disasters, financial crises or pandemics) on gross
domestic product (GDP) by analyzing high-frequency electricity market data. As
an illustration, we estimate the GDP loss caused by COVID-19 in twelve European
countries during the first wave of the pandemic. Our results are almost
indistinguishable from the official statistics of the recession during the
first two quarters of 2020 (correlation coefficient of 0.98) and are validated
by several robustness tests. However, they are also more chronologically
disaggregated and up-to-date than standard macroeconomic indicators and,
therefore, can provide crucial and timely information for policy evaluation.
Our results show that delaying intervention and pursuing 'herd immunity' have
not been successful strategies so far, since they increased both economic
disruption and mortality. We also find that coordinating policies
internationally is fundamental for minimizing spillover effects from NPIs
across countries.
