Analyzing the causal Relationship between Global Trade and the Prevalence of Covid 19

Document Type : Research Paper

Author

Assistant Professor of Economics, Shahid Chamran University of Ahvaz, Ahvaz, Iran

10.30465/jnet.2022.36996.1747

Abstract

The outbreak of Covid 19 pandemic started from a disease affecting the human immune system and health and now it has spread to the economies of all the countries of the world and the international economy. In other words, this disease has directly faced a serious crisis in the service sector, such as tourism and has pushed other sectors with broad economic constraints and to some extent to the brink of bankruptcy. Unemployment and employment have become critical in many countries, and declining GDP has been reported in many countries. The question is, has globalization fueled the spread of the corona in the world? And has the outbreak had a significant impact on trade volume and globalization? In other words, are countries with more open indicators from the perspective of globalization, for example, have the degree of openness made the disease more prevalent in the world? And has the outbreak significantly reduced business flows in the world? This study analyzes the relationship between global trade and the prevalence of Covid 19 among 70 countries of the world, two groups of developing countries (50 countries) and developed countries (20 countries) using the monthly panel data and GMM method from the of 2019 to the beginning of 2021. Research results Indicates the significant effects of the disease outbreak on the reduction of trade flows between countries. The results also show that the prevalence of Granger causality between Covid 19 and the reduction of globalization and trade volume of countries. Finally, suggestions for reducing the negative effects of epidemics is about the global economy.

Keywords

References

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History

  • Receive Date: 26 February 2022
  • Revise Date: 19 April 2022
  • Accept Date: 05 May 2022

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