The impact of COVID-19 on seasoned equity offering: Evidence from China

This study examines the impact from the COVID-19 pandemic on the association between Chinese firms' SEO announcements and market reaction afterwards. Our findings indicate that market investors would respond more negatively to the SEO announcements and undergo more SEO underpricing for firms from regions significantly affected by the pandemic than those from the less-affected regions. Furthermore, higher CSR scores and more involvements in accounting conservatism could mitigate these effects. The main mechanism of the moderating effect from CSR performance and accounting conservatism is that CSR investment and accounting conservatism could lessen information asymmetry between the SEO announced firms and outside investors. Finally, we document that the main motivation of SEO issuance during the pandemic is market timing.     

The political economy of lockdown: Does free media matter?

This paper studies the role of free media in how governments and the public responded to the COVID-19 pandemic. We first document the presence of policy and behavioural responsiveness during the early phase of the pandemic. Using a panel data of daily COVID-19 deaths, lockdown policies, and mobility changes in 155 countries, we find that governments were more likely to impose a lockdown, and citizens to reduce their mobility, as the initial number of deaths increased. To measure the role of media freedom on responsiveness given endogeneity in death reporting, we simulate deaths from a calibrated SEIR model as an instrument for reported deaths. Using this approach, we find evidence that the presence of free media mattered for the timing of early responses to COVID-19. Responsiveness to deaths was limited to citizens in free-media countries, and accounted for 40% of the difference in lockdown decision and mobility changes between free-media and censored-media countries. In support of the role of free media, we show that differences in responsiveness are not explained by a range of other country characteristics such as the level of income, education or democracy. We also find evidence that citizens with access to free media were better informed about the pandemic and had more responsive levels of online searches about COVID-19, supporting the view that free media served to inform the public on the risks of COVID-19.     

China’s Exports during the Global COVID-19 Pandemic

The global COVID-19 pandemic caused various economic contraction in most countries, including all of China’s major trading partners. Using a difference-in-differences model, this study examines the impact of the COVID-19 pandemic on China’s monthly exports from January 2019 to May 2020. We find strong and robust evidence that China’s exports to countries at high risk from the pandemic experienced a larger decline than exports to low-risk countries after the onset of the pandemic, with the prices of exports increasing significantly. Furthermore, the results of a triple differences model show heterogeneous effects across different industries and goods. Chinese industries located upstream in the global value chain are more vulnerable than those located downstream. Industries with high labor and contract intensity (proxies for processing trade) experienced greater declines than other industries. Exports of goods with high import elasticity of substitution experienced higher prices and moderate volume losses due to the pandemic.     

The sooner,the better: The economic impact of non-pharmaceutical interventions during the early stage of the COVID-19 pandemic

This paper estimates the economic impact of the non-pharmaceutical interventions (NPIs) implemented by countries in Europe and Central Asia during the initial stages of the COVID-19 pandemic. The analysis relies on daily electricity consumption, nitrogen dioxide emission and mobility records to trace the economic disruptions caused by the pandemic and calibrate these measures to estimate the magnitude of the economic impact. To address the potential endogeneity in the introduction of NPIs, we instrument their stringency by the extent of a country's social ties to China. The results suggest that the NPIs led to a decline of about 10% in economic activity across the region. On average, countries that implemented non-pharmaceutical interventions in the early stages of the pandemic appear to have better short-term economic outcomes and lower cumulative mortality, compared with countries that imposed non-pharmaceutical interventions during the later stages of the pandemic. Moreover, there is evidence that COVID-19 mortality at the peak of the local outbreak has been lower in countries that acted earlier. In this sense, the results suggest that the sooner non-pharmaceutical interventions are implemented, the better are the economic and health outcomes.     

Impact of infectious disease pandemics on individual lifetime consumption: An endogenous time preference approach

This paper considers the impact of the coronavirus disease 2019 (COVID-19) pandemic on long-term individual lifetime consumption profiles. The framework for the analysis is a model that extends Strulik (2021) to include the government sector, where time preference is determined by individual health damage (deficit) distinct from normal aging. Thus, the health damage caused by COVID-19 changes the rate of time preference and consequently affects the Euler equation for consumption. Our theoretical contribution is the consistent incorporation of public health investment into the existing model to understand the effect of government measures against a pandemic. Numerical analysis based on this model is used to estimate changes in health status over time, trends in the rate of time preference, and individual lifetime consumption profiles, taking into account differences in age at the time of the pandemic and the nature of the government responses. Because the long-term negative economic impact would be enormous, we should avoid advocating for “living with COVID-19” without due consideration. The reopening of the economy must be accompanied by a commitment to the containment and elimination of infections with future novel coronaviruses.     

COVID-19 fatalities and internal conflict: Does government economic support matter?

This study examines the association between COVID-19 mortality rates and internal conflict and investigates the possible moderating role of government economic support during the pandemic years of 2020 and 2021. Our main hypothesis suggests that countries with lower levels of government economic support are more likely to experience a positive correlation between higher COVID-19 mortality rates and the emergence of internal conflict. Using cross-country data from over 100 countries and controlling for various factors that may influence internal conflict, our analysis provides some support for this hypothesis. The results suggest a possible moderating role for government economic support, with the evidence indicating a weakening or elimination of the association between COVID-19 mortality rates and internal conflict when government economic support is adequate. However, the moderating effect of government economic support is not always significant, and caution is needed when interpreting the results. Our analysis also highlights the potential risks associated with low levels of government economic support during the pandemic. Specifically, we find that in countries where the government's macro-financial package in response to the pandemic is less than approximately 25% of GDP, there is a possible risk of growth in civil disorder resulting from increased COVID-19 deaths per million.     

Past Experiences,Personality Traits,and Risk Aversion: Evidence from Individual Risk Attitudes during the COVID-19 Pandemic

Individuals’ risk attitudes play an important role in economic decision making and policy evaluation, particularly in the midst of unprecedented uncertainty caused by the COVID-19 pandemic. We adopt a multiple-price-list elicitation method with real money incentives to measure precisely individuals’ risk attitudes at different stake levels and the extent to which they are affected by personal and social shocks following the COVID-19 outbreak in China. We find that subjects who had previously experienced negative personal shocks are more risk-averse at medium and large stakes but more risk loving at very small stakes. For our sample, COVID-19 has no significant impact on risk attitudes, as it is more likely to be regarded as a social shock. The result indicates that the impact of COVID-19 on individual risk attitudes is not as influential as expected, unless the individual’s personal life is affected directly.     

Health and Public Health Implications of COVID-19 in Asian Countries

This paper discusses the impacts of the COVID-19 pandemic on population health in Asian countries. Compared to European countries, Asian countries, in general, experienced much fewer COVID-19 cases and deaths. The underlying factors in this difference would include the earlier and more stringent nonpharmaceutical interventions, differences in the age structure, the geographical characteristics in Asia, and the experience of past outbreaks of emerging diseases, though further studies are needed to investigate the exact mechanisms. Still, regarding the aim of developing resilient health care systems, there remain several lessons from the COVID-19 pandemic experience in Asian countries that could inform more effective management of future pandemics.     

COVID-19 lockdown,family migration and unemployment in a gendered society

COVID-19 has posed severe challenges not only to researchers in the field of medicines and natural sciences but also to policymakers. Almost all nations of the world lockdown have been chosen as an immediate response to this pandemic crisis. The labour market in developing economies continues to be gendered with gender-based wage differentials besides occupational segregation, women who are the marginalized section in the society, bear the brunt of the unprecedented COVID-19 lockdown. Against this backdrop, a multi-sectoral general equilibrium model has been constructed with heterogeneity in migration (with and without family migration) that has been derived from the intra-household bargaining problem amongst unskilled families to analyse the gendered effect of the pandemic. Lockdown has been conceptualized as a restriction on the physical gathering of labour in the contact-intensive sectors. The results of the paper reflect internal contradictions of developing economies that have a conditional-conditioning relationship with an archaic structure.     

Reverse Immigration Effects for Expatriates in Oman During the COVID-19 Pandemic Shock

The COVID-19 pandemic produced dramatic aftershocks throughout the global labor markets with rapid changes in differential employment opportunities. Labor market disruptions were sparked by the pandemic in Oman, where expatriates live and work. For the first time, the analysis investigates certain hypotheses relevant to the Aspirations-Capabilities framework and whether these hypotheses survive the pandemic exogenous shock. More specifically, testing these hypotheses, the analysis investigates whether the COVID-19 pandemic shock had a negative impact on expatriates in the host country, as well as it identifies heterogeneous effects among different ethnic groups. Using Datastream data, this analysis investigates the sudden drop in ethnic expatriates in Oman using ordinal least squares and instrumental variable estimations. A steeper decline in the expatriate employment rate reflects a disproportionately adverse impact that the initial phase of the COVID-19 pandemic had on immigrant employment. The findings identify substantial ethnic differences when reverse immigratory effects are exhibited.

     

Material and nonmaterial impacts of the COVID-19 pandemic: Evidence from a low-income country

How have COVID-19-related restrictions affected consumption levels and life satisfaction in low-income countries? We conducted phone surveys with 577 households in Liberia to compare consumption patterns across three points in time: November 2019 (pre-COVID-19), May 2020 (short term), and September 2020 (medium term). This article analyzes the impacts of the Covid-19 pandemic and the related restrictions on food and nonfood consumption, which we categorize as “material” welfare and life satisfaction, which we categorize as “nonmaterial” welfare. We find differences between food and nonfood consumption patterns under pandemic conditions. In particular, consumption by households dependent on food and labor markets was negatively affected by the pandemic. In terms of life satisfaction, we find that most respondents perceived their lives to have worsened due to the pandemic.     

What Implications Does COVID-19 Have on Sustainable Economic Development in the Medium and Long Terms?

Given the enormous impact that the COVID-19 pandemic had on China’s economy, helping companies to revitalize post-pandemic economic activities promptly is a priority for the whole society. This necessitates the smooth circulation of production-factors among different economic entities, departments, and regions. The pandemic’s huge impact on the economy is evident in the severely hampered flow of these factors, including labor, materials, and capital. Therefore, using data and digital technology, combined with a contact-free allocation of labor, capital, and materials, to accelerate the flow of production-factors is critical to the post-pandemic economy’s restoration. Such a policy can not only provide a short-term stimulus but also a momentum for China’s mid- and long-term sustainable economic development.     

COVID-19 and pro-sociality: How do donors respond to local pandemic severity,increased salience,and media coverage?

Experimental Economics - Has the COVID-19 pandemic affected pro-sociality among individuals? After the onset of the pandemic, many charitable appeals were updated to include a reference to...     

Place-Based Policies and Nowcasting

There is a growing need to gauge local economic activity in real time. Localised economic challenges have been emphasised in the wake of the COVID-19 pandemic. Real-time trackers (such as OECD trackers) and other nowcasting applications typically correspond to national or highly aggregated regions. In this discussion paper, we briefly explore how unconventional data might be used to produce nowcasts of local economies. We argue that in the absence of traditional nowcasting metrics, efforts to nowcast local economies need a local perspective, with data capture tailored to address heterogeneity across three domains: (1) resources, (2) people and (3) life.     

Does expert information affect citizens’ attitudes toward Corona policies? Evidence from Germany

Information provided by experts is believed to play a key role in shaping attitudes towards policy responses to the COVID-19 pandemic. This paper uses a survey experiment to assess whether providing citizens with expert information about the health risk of COVID-19 and the economic costs of lockdown measures affects their attitudes towards these policies. Our findings show that providing respondents with information about COVID-19 fatalities among the elderly raises support for lockdown measures, while information about their economic costs decreases support. However, different population subgroups react differently. Men and younger respondents react more sensitively to information about lockdown costs, while women and older respondents are more susceptible towards information regarding fatality rates. Strikingly, our results are entirely driven by respondents who underestimate the fatality of COVID-19, who represent a majority.     

Worker-firm relational contracts in the time of shutdowns: experimental evidence

Experimental Economics - Exogeneous disruptions in labor demand have become more frequent in recent times. The COVID-19 pandemic has resulted in millions of workers being repeatedly laid off and...     

The People’s bank of China’s response to the coronavirus pandemic: A quantitative assessment

The People’s Bank of China (PBoC) has implemented numerous measures to cushion the impacts of the COVID-19 health crisis on the Chinese economy. Since the current monetary policy framework features a multi-instrument mix of liquidity tools and pricing signals, we employ a dynamic-factor modelling approach to derive a composite indicator of China’s monetary policy stance. Our quantitative assessment shows that the PBoC’s policy response to the outbreak of the COVID-19 pandemic has been swift and decisive. Specifically, our estimates reveal that the PBoC has implemented novel policy measures to ensure that commercial banks maintain liquidity access and credit provision during the COVID-19 crisis.     

Subjective beliefs and economic preferences during the COVID-19 pandemic

Experimental Economics - The COVID-19 pandemic presents a remarkable opportunity to put to work all of the research that has been undertaken in past decades on the elicitation and structural...     

Long COVID? Prospects for economic scarring from the pandemic

This paper examines the potential persistent effects (scarring) of the COVID-19 pandemic on the economy and the channels through which they may occur. Our findings from a broad set of historical recessions confirm that recessions are associated with persistent output losses and that the greatest scarring has occurred following financial crises. The amount of scarring following pandemic and epidemic recessions in the sample is in between that of typical recessions and financial crises. Results on the channels show that the productivity channel is important, as all types of recessions have been followed by persistent losses to total factor productivity.