ABSTRACT
Purpose: The purpose of this paper is to examine the response of Travel & Leisure (T&L) stocks of some advanced economies (the USA and United Kingdom) as well as Europe to uncertainty due to pandemics and epidemics. The motivation for the study is derived from the expectation that pandemics and epidemics which are infectious would limit activities and events that require physical interactions such as those associated with T&L, and therefore, returns on related investments may decline during this period. Design/methodology/approach: The authors formulate a model in line with Westerlund and Narayan (2012, 2015) where uncertainty due to infectious diseases is included as a predictor in the valuation of T&L stocks while also controlling for endogeneity bias (for omitted variables bias), conditional heteroscedasticity effect (typical of high frequency data) and persistence (typical of most financial and economic time series). Findings: The authors’ results suggest that contrary to the negative impact of previous cases of pandemics and epidemics on the T&L stocks, the behavior of these stocks during COVID-19 pandemic is modest owing to the positive nexus between equity market volatility due to infectious diseases (EMV-ID) (our proxy for pandemics and epidemics) and the T&L returns during the COVID-19 period. The authors maintain that investors in this market need not panic as the market tends to be resilient to pandemics over time albeit with a lower resilience during daily trading. The results leading to this conclusion are robust to alternative measures of the COVID-19 pandemic. Originality/value: The peculiarity of this paper on T&L stocks is premised on the introduction of the new datasets for infectious diseases, and the need to include the COVID-19 pandemic given its peculiarity. Essentially, we utilize the Baker et al. (2020) dataset which captures all the pandemics including COVID-19 and a complementary dataset on the COVID-19 pandemic using an alternative approach. © 2022, Emerald Publishing Limited.
ABSTRACT
In the last decade, the tourism sector in Portugal registered a strong growth, with sustained and con-tinuous rises in tourism arrivals and receipts. However, the COVID-19 pandemic abruptly stopped the travel sector in Portugal, immobilizing the movement of people, resulting in significant changes in tou-rists’ behavior, decisions and planning. A sample of more than 300 tourists in Central Portugal, one of the most diverse tourism destination, allowed to conclude that the current pandemic had a significant impact on travel plans, decisions and tourist consumption. On the other hand, it was also possible to assess the change in behavior and the acceptance of the new safety measures imposed in the context of the pandemic. The results of the study allowed the indication of strategies for destination managers to recover tourist attractiveness in a Post-COVID scenario. © 2022,Revista Portuguesa de Estudos Regionais.All Rights Reserved
ABSTRACT
Motivated by the COVID-19 pandemic, we construct a single factor predictive model for stock returns that incorporates uncertainty index for pandemics and epidemics (UPE). Specifically, we examine whether Islamic stocks are either vulnerable or have better hedge potential when compared to the performance of their conventional counterparts. In general, we find that the Islamic stocks can be used to hedge whereas the conventional stocks are seen to be vulnerable to uncertainty due to pandemics across different time periods. In particular, during COVID-19 pandemic, although the hedging effectiveness of Islamic stock seems to decline, it is still better compared to the worse performance of the conventional stocks. The outcome remains the same even after controlling our model for oil price, geopolitical risk and economic policy uncertainty. We further evaluate the predictive power of the UPE both for the in-sample and out-of-sample periods by comparing its forecast performance with that of a benchmark model. Our results suggest that the consideration of the UPE information in the valuation of stocks is crucial for investment decisions.
ABSTRACT
When faced with adverse circumstances, there may be a tendency for individuals, agencies, and governments to search for a target to assign blame. Our focus will be on the novel coronavirus (COVID-19) outbreak, where racial groups, political parties, countries, and minorities have been blamed for spreading, producing or creating the virus. Blame-here defined as attributing causality, responsibility, intent, or foresight to someone/something for a fault or wrong-has already begun to damage modern society and medical practice in the context of the COVID-19 outbreak. Evidence from past and current pandemics suggest that this tendency to seek blame affects international relations, promotes unwarranted devaluation of health professionals, and prompts a spike of racism and discrimination. By drawing on social and cognitive psychology theories, we provide a framework that helps to understand (1) the effect of blame in pandemics, (2) when people blame, whom they blame, and (3) how blame detrimentally affects the COVID-19 response. Ultimately, we provide a path to inform health messaging to reduce blaming tendencies, based on social psychological principles for health communication.