Impact of COVID-19 on returns-volatility spillovers in national and regional carbon markets in China

China wants to play a leading role in international carbon reduction and has ambitious reduction plans. China is one of the largest carbon emitters globally with an increasing trade volume in both national and regional markets. Owing to carbon emissions are regarded as key policy instruments and important financial assets thus It is important to analyze volatility spillovers between national and regional markets. The Diagonal BEKK model is used to examine daily financial returns, conditional covariances, and volatility spillovers across markets before, during, and after COVID-19. The empirical results show that the magnitudes of the spillovers during COVID-19 are much larger than before and after COVID-19 which implies the impact of COVID-19 on China's economy leads to greater risk transmission across carbon markets. China's experience (from regional to national) was useful in informing the channels of risk transmission and helping understand the relevance of carbon markets for investment decisions and public policymaking in the international carbon markets. Finally, we discuss the motivations, challenges, and possible forms of cooperation between China and the Eurozone on establishing a common carbon market are discussed.

Alternative Global Health Security Indexes for Risk Analysis of COVID-19.

Given the volume of research and discussion on the health, medical, economic, financial, political, and travel advisory aspects of the SARS-CoV-2 virus that causes the COVID-19 disease, it is essential to enquire if an outbreak of the epidemic might have been anticipated, given the well-documented history of SARS and MERS, among other infectious diseases. If various issues directly related to health security risks could have been predicted accurately, public health and medical contingency plans might have been prepared and activated in advance of an epidemic such as COVID-19. This paper evaluates an important source of health security, the Global Health Security Index (2019), which provided data before the discovery of COVID-19 in December 2019. Therefore, it is possible to evaluate how countries might have been prepared for a global epidemic, or pandemic, and acted accordingly in an effective and timely manner. The GHS index numerical scores are calculated as the arithmetic (AM), geometric (GM), and harmonic (HM) means of six categories, where AM uses equal weights for each category. The GHS Index scores are regressed on the numerical score rankings of the six categories to check if the use of equal weights of 0.167 in the calculation of the GHS Index using AM is justified, with GM and HM providing a check of the robustness of the arithmetic mean. The highest weights are determined to be around 0.244-0.246, while the lowest weights are around 0.186-0.187 for AM. The ordinal GHS Index is regressed on the ordinal rankings of the six categories to check for the optimal weights in the calculation of the ordinal Global Health Security (GHS) Index, where the highest weight is 0.368, while the lowest is 0.142, so the estimated results are wider apart than for the numerical score rankings. Overall, Rapid Response and Detection and Reporting have the largest impacts on the GHS Index score, whereas Risk Environment and Prevention have the smallest effects. The quantitative and qualitative results are different when GM and HM are used.

Factors Affecting the Cases and Deaths of COVID-19 Victims.

This paper attempts to find the factors that affect the number of cases and deaths of coronavirus disease 2019 (COVID-19) patients a year after the first outbreak in Wuhan, China. There were 141 countries affected with COVID-19 involved in the study. Countries were grouped based on population. Using ordinary least squares regression, it was found that the total number of cases and deaths were significantly related with the levels of population of the different countries. On the overall, median age of the country, and average temperature are positively related with the number of deaths from the virus. On the other hand, population density is positively related with the deaths due to COVID for low populated countries. The result of this preliminary study can be used as a benchmark for authorities in the formulation of policies with regards to treating COVID-19 related issues.

Herding behaviour in energy stock markets during the Global Financial Crisis, SARS, and ongoing COVID-19.

Environmental change created worldwide interest in investing in renewable energy. Less reliance on fossil fuels would have a substantial influence on investors for alternative energy, especially renewable energy. The literature has concentrated on empirical studies of herding behaviour in finance, but not in renewable energy. This paper fills the gap by investigating herding in renewable energy, using daily closing prices in renewable and fossil fuel energy stock returns in the USA, Europe, and Asia, for March 24, 2000-May 29, 2020, which covers the Global Financial Crisis (GFC) (2007-2009), the coronavirus crises of SARS (2003). And the ongoing COVID-19 (2019-2020) pandemic. The paper shows that: (1) for low extreme oil returns, investors are more likely to display herding in the stock market; (2) for SARS and COVID-19, herding is more likely during extremely high oil returns after the GFC; and (3) herding is more likely during periods of extremely low oil returns during the coronavirus crises. These results suggest that after the GFC, investors are more sensitive to asset losses, so they will be more likely to display herding in the stock market. However, during SARS and COVID-19, investors panic so they may unwisely sell their assets. There are strong cross-sector herding spillover effects from US fossil fuel energy to renewable energy, especially before the GFC, while the US fossil fuel energy market has a significant influence on the Europe and Asia renewable energy returns during COVID-19. During SARS, which was not a pandemic, US fossil fuels only had an impact on US renewable energy returns.

Risk and Financial Management of COVID-19 in Business, Economics and Finance

<p>The SARS-CoV-2 coronavirus that causes the COVID-19 disease led to the most significant change in the world order over the past century, destabilizing the global economy and financial stock markets, the world’s economy, social development, business, risk, financial management and financial markets, among others. COVID-19 has generated great uncertainty, and dramatically affected tourism, travel, hospitality, supply chains, consumption, production, operations, valuations, security, financial stress and the prices of all products, including fossil fuel and renewable energy sources. This Editorial introduces a Special Issue of the Journal of Risk and Financial Management (JRFM) on the “Risk and Financial Management of COVID-19 in Business, Economics and Finance”. This Special Issue will attract practical, state-of-the-art applications of mathematics, probability and statistical techniques on the topic, including empirical applications. This paper investigates important issues that have been discussed in tourism, global health security and risk management in business as well as the social and medical sciences.</p>