"Delight in Reasons 学术·理想·人格"
China Economics and Management Academy, CUFE
Born around the turn of the millennium, we spent our infancy amid the 2003 SARS outbreak, grew up hearing more or less from the news about the 2009 H1N1 flu, and then, just as we came of age and entered college, we encountered the COVID-19 pandemic that swept the globe starting in 2020. Whether in ignorance, at a distance, or through direct experience, reflecting on and portraying pandemics as major public-health events has been a long-standing focus of my thinking and note-keeping throughout my four years in college.
First, I want to thank the era in which I was born. It has always been my source of inspiration, my muse. It is the worst of times, but it is also the best of times. Although the pandemic upended our lives, these changes have raised many thought-provoking questions that deserve careful consideration and even self-reflection.
Second, I want to thank my college, which will surely be a vital navigator in my life. The greatest gain from my four undergraduate years at CEMA has been the reshaping of my worldview and historical perspective. I learned to consider the causes of the same phenomenon from the angles of economics, finance, and sociology, to switch between micro and macro in order to examine subjects dialectically, to mine data for hidden patterns, and to build models to analyze transmission mechanisms. Before coming to CEMA, I never imagined that I would devote the most creative years of my life to exploring knowledge, the world, and the unknown, and that I would continue to do so.
— Written in June 2023 as part of the acknowledgments for my bachelor’s thesis
- Project 1 · Post-Pandemic Public Health Services – DSGE-based analysis of government health expenditure and macroeconomic recovery.
- Project 2 · Pandemic Shock to Investment Markets – TVP-VAR assessment of investor sentiment and stock market resilience during epidemic peaks.
RQ1 · How do public health services such as vaccination and nucleic-acid (PCR) testing affect the post-pandemic macroeconomy?
Title: The Macroeconomic Impact of China’s Post-Pandemic Public Health Expenditure: A DSGE Analysis of Dynamic Effects
Abstract: Within the framework of a small open economy, this paper builds a dynamic stochastic general equilibrium (DSGE) model that incorporates the distinctive features of public health services in government fiscal expenditure. We introduce such spending in two ways: as consumption-type government expenditure in the household utility function, and as investment-type government expenditure in the production function of public-goods firms. We then examine how expansionary fiscal policy stimulates a pandemic-struck macroeconomy and through which transmission mechanisms. The results show that: (1) in the short run, consumption-type and investment-type expenditure shocks have broadly similar moderating effects, but consumption-type spending delivers a stronger short-term macroeconomic stimulus than investment-type spending; (2) in the short run, expansionary fiscal expenditure effectively releases labor supply and spurs the recovery of production; (3) in the short run, expansionary fiscal expenditure exerts no clear “crowding-out” effect on private household consumption, but it does widen the trade deficit; and (4) in the long run, the stimulus effect of investment-type expenditure shocks is more persistent than that of consumption-type shocks.
Key words: Government expenditure, expansionary fiscal policy, public goods, DSGE
Title: The Impact of Major Public Health Emergencies on Stock Market Volatility: An Investor Sentiment Perspective
Abstract: This paper uses a TVP-VAR model to investigate the general pattern of stock market dynamics in the face of shocks from major public health emergencies, using COVID-19 epidemic as a canonical case, and further selects three different epidemic outbreak nodes to analyze and compare the impact of shocks. The empirical results show that: (1) the epidemic causes a persistent negative shock to the stock market, which peaks in the current period; (2) the epidemic causes a persistent positive shock to investor sentiment fluctuations, which usually peaks on day 2, and investor sentiment fluctuations resonate inversely with stock market returns under the epidemic shock; (3) fluctuations in investor sentiment can exert a temporary negative shock on the stock market, with the impact of the shock subsiding within six days; (4) as the epidemic progresses, the magnitude of the impact of the epidemic gradually expands, and its impact on investor sentiment and the impact the sentiment exerts on the market are much larger than those at the stable period of the epidemic; (5) the second node of the epidemic outbreak (March 27, 2022), compared to the first node of the outbreak (January 20, 2020) and the third node of the outbreak (December 7, 2022), the equity market possesses the strongest resilience ability.
Key words: Public health emergency, investor sentiment, TVP-VAR
- Torres Chacón, J. L. (2015). Introduction to Dynamic Macroeconomic General Equilibrium Models (2nd ed.). Vernon Press.
- Diamond, J. M. (1997). Guns, germs, and steel: The fates of human societies. New York, NY: W. W. Norton. ISBN 0-393-03891-2.
- Levitt, S. D., & Dubner, S. J. (2005). Freakonomics: A rogue economist explores the hidden side of everything. New York, NY: William Morrow. ISBN 006073132X.
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