Coronavirus disease outbreak and supply chain disruption: Evidence from Taiwanese firms in China
ABSTRACT: Graphical abstract This study applies an empirical analysis to examine whether supply chain disruption is caused by the outbreak of the coronavirus disease (COVID-19) that was first reported in Wuhan, China, on December 31, 2019. The study’s findings indicate a link between the COVID-19 outbreak and the disruption of logistics and supply chains along with negative cumulative abnormal returns within Taiwanese firms manufacturing products in China and marketing them globally. This is the first study to examine the outbreak of the COVID-19 and the disruption of the supply chain and its effect on the stock market. The empirical results provide insights for business management in reconsidering their global supply chain strategies for the risk of disruption caused by similar epidemics occurs in the future.
Project description:This paper investigates the effect of firm-level operating flexibility on stock performance during the COVID-19 outbreak in China. We find that firm-level operating flexibility is significantly positively correlated with the cumulative abnormal stock returns that occurred during the event window, and this positive relation is more pronounced in firms in the provinces most affected by the epidemic. This positive relation is also more obvious in firms that have relatively fewer fixed assets. Therefore, our results provide direct empirical evidence that the real options embedded in operating flexibility played an important role during the COVID-19 outbreak.
Project description:The COVID-19 pandemic has affected global supply chains at an unprecedented speed and scale. This paper investigates the supply chain challenges that manufacturing organizations have faced due to the COVID-19 outbreak, particularly in emerging economies. We present a conceptual framework under the dynamic capability theory to analyze challenges and their pertinent mitigation strategies. Ten major challenges are identified based on a literature review, evaluation of several news articles, and discussions with experts. Further, the Grey-Decision-making Trial and Evaluation Laboratory (Grey-DEMATEL) method is applied to analyze the relationships between various supply chain challenges. Scarcity of Labor (PSL) emerges as the most significant challenge, closely followed by Scarcity of Material (SSM). The results also suggest that Inconsistency of Supply (PIS) is the challenge that correlates the most with other factors. Finally, in this paper we also provide guidelines and strategies for practitioners and scholars to better address supply chain challenges post-COVID-19 outbreak.
Project description:Since COVID-19 was confirmed in Bangladesh in March 2020, the government have enacted stringent measures to prevent the spread of the coronavirus, which has had a significant impact on people's lives. Food consumption habits of consumers have shifted as a result of declining grocery shopping frequency, negative income shock, and food prices shooting up. This paper aims to explore Bangladeshi consumers' buying behaviour in association with the stress generated from a food supply shortage during the COVID-19 pandemic and the post-outbreak perception of the food industry, using a dataset with 540 online samples collected between July and August 2021. A two-stage cluster sampling method and self-administrated questionnaire techniques were adopted for collecting the data during the third wave of COVID-19. Using partial least squares path modelling (PLS-PM) and multivariate multiple ordered logit regression (MVORD) to reveal the pertinent structure between all the blocks, this study provides two key findings. First, a higher intensity of COVID-19 impact translates into higher food stress associated with income reduction and higher food prices. Second, food stress directly affects consumer buying and consumption behaviour. We strongly recommend connecting consumers with local producers and collective use of shared warehouses through institutions, policies, and reforms to prevent disruption in the food supply chain and to keep food prices stable. Additionally, food producers, distributors, stakeholders, and policy planners should strengthen the food supply chain to stabilize food security.
Project description:This study investigates oil price risk exposure of financial and non-financial industries around the world during the COVID-19 pandemic. The empirical results show that oil supply industries benefit from positive shocks to oil price risk in general, whereas oil user industries and financial industries react negatively to positive oil price shocks. The COVID-19 outbreak appears to moderate the oil price risk exposure of both financial and non-financial industries. This brings important implications in risk management of energy risk during the pandemic.
Project description:Manufacturing firms that continued production activities during the COVID-19 have been taking necessary measures to cope with the risks imposed by the pandemic. This study assesses the measures implemented by the Ready-Made Garments (RMG) sector in Bangladesh. With the increase in COVID-19 cases in Bangladesh, following government order, along with firms in other manufacturing sectors, the RMG firms had to shut-down their production between March 26 and April 25, 2020. Soon after the factories reopened, they had to take necessary actions to ensure employee safety, supply of raw materials, and purchase orders from buyers. Using a semi-structured interview approach, we identify 16 measures that have been implemented in the RMG sector in Bangladesh for the employees, suppliers and buyers. Then, we assess the degree of implementation of these measures using the Bayesian Best-Worst method. We find that providing healthcare safety, bringing previously outsourced activities in-house, and ensuring smooth delivery of existing orders were the three most implemented measures for employees, suppliers and buyers, respectively. On a higher level, the RMG industry professionals prioritised buyer-related measures the most, followed by employee and supplier-related. The analysed measures provide a blueprint for supply chain risk management during future waves of COVID-19 transmission and for other potential large-scale natural disasters.
Project description:The global spread of the novel coronavirus, also known as the COVID-19 pandemic, has had a devastating impact on supply chains. Since the pandemic started, scholars have been researching and publishing their studies on the various supply-chain-related issues raised by COVID-19. However, while the number of articles on this subject has been steadily increasing, due to the absence of any systematic literature reviews, it remains unclear what aspects of this disruption have already been studied and what aspects still need to be investigated. The present study systematically reviews existing research on the COVID-19 pandemic in supply chain disciplines. Through a rigorous and systematic search, we identify 74 relevant articles published on or before 28 September 2020. The synthesis of the findings reveals that four broad themes recur in the published work: namely, impacts of the COVID-19 pandemic, resilience strategies for managing impacts and recovery, the role of technology in implementing resilience strategies, and supply chain sustainability in the light of the pandemic. Alongside the synthesis of the findings, this study describes the methodologies, context, and theories used in each piece of research. Our analysis reveals that there is a lack of empirically designed and theoretically grounded studies in this area; hence, the generalizability of the findings, thus far, is limited. Moreover, the analysis reveals that most studies have focused on supply chains for high-demand essential goods and healthcare products, while low-demand items and SMEs have been largely ignored. We also review the literature on prior epidemic outbreaks and other disruptions in supply chain disciplines. By considering the findings of these articles alongside research on the COVID-19 pandemic, this study offers research questions and directions for further investigation. These directions can guide scholars in designing and conducting impactful research in the field.
Project description:The study aims to understand Twitter users' discourse and psychological reactions to COVID-19. We use machine learning techniques to analyze about 1.9 million Tweets (written in English) related to coronavirus collected from January 23 to March 7, 2020. A total of salient 11 topics are identified and then categorized into ten themes, including "updates about confirmed cases," "COVID-19 related death," "cases outside China (worldwide)," "COVID-19 outbreak in South Korea," "early signs of the outbreak in New York," "Diamond Princess cruise," "economic impact," "Preventive measures," "authorities," and "supply chain." Results do not reveal treatments and symptoms related messages as prevalent topics on Twitter. Sentiment analysis shows that fear for the unknown nature of the coronavirus is dominant in all topics. Implications and limitations of the study are also discussed.
Project description:This paper studies the impact of the outbreak of coronavirus disease 2019 (COVID-19) on the stock price crash risk of energy firms in China. We find that the stock price crash risk of energy firms significantly decreases in the post-COVID-19 period. We also find that firms that engage in more corporate social responsibility (CSR) activities are less exposed to stock price crash risk in the post-COVID-19 period than those that engage in less CSR activities. Finally, we show that the effect of COVID-19 on stock price crash risk is less severe for state-owned enterprises (SOEs) than for non-SOEs in the post-COVID-19 period. Our findings demonstrate China's economic recovery in the post-COVID-19 period and have policy implications for firms to improve their resilience to exogenous shocks.
Project description:Plastic products have played significant roles in protecting people during the COVID-19 pandemic. The widespread use of personal protective gear created a massive disruption in the supply chain and waste disposal system. Millions of discarded single-use plastics (masks, gloves, aprons, and bottles of sanitizers) have been added to the terrestrial environment and could cause a surge in plastics washing up the ocean coastlines and littering the seabed. This paper attempts to assess the environmental footprints of the global plastic wastes generated during COVID-19 and analyze the potential impacts associated with plastic pollution. The amount of plastic wastes generated worldwide since the outbreak is estimated at 1.6 million tonnes/day. We estimate that approximately 3.4 billion single-use facemasks/face shields are discarded daily as a result of COVID-19 pandemic, globally. Our comprehensive data analysis does indicate that COVID-19 will reverse the momentum of years-long global battle to reduce plastic waste pollution. As governments are looking to turbo-charge the economy by supporting businesses weather the pandemic, there is an opportunity to rebuild new industries that can innovate new reusable or non-plastic PPEs. The unanticipated occurrence of a pandemic of this scale has resulted in unmanageable levels of biomedical plastic wastes. This expert insight attempts to raise awareness for the adoption of dynamic waste management strategies targeted at reducing environmental contamination by plastics generated during the COVID-19 pandemic.
Project description:Climate change will increase the frequency and severity of supply chain disruptions and large-scale economic crises, also prompting environmentally protective local policies. Here we use econometric time series analysis, inventory-driven price formation, dynamic material flow analysis, and life cycle assessment to model each copper supply chain actor's response to China's solid waste import ban and the COVID-19 pandemic. We demonstrate that the economic changes associated with China's solid waste import ban increase primary refining within China, offsetting the environmental benefits of decreased copper scrap refining and generating a cumulative increase in CO<sub>2</sub>-equivalent emissions of up to 13 Mt by 2040. Increasing China's refined copper imports reverses this trend, decreasing CO<sub>2</sub>e emissions in China (up to 180 Mt by 2040) and globally (up to 20 Mt). We test sensitivity to supply chain disruptions using GDP, mining, and refining shocks associated with the COVID-19 pandemic, showing the results translate onto disruption effects.