DYNAMIC SPILLOVER EFFECT OF COVID-19 EPIDEMIC ON DRUG INVENTORY IN AFFECTED COUNTRIES — FROM THE PERSPECTIVE OF INVESTOR ANXIETY
Authors: Li Rong , Peng Yuzhen , Zhang Jingyi , Zhu Ruolan 
Published: July 2022

Abstract

Background
Since the beginning of 2020, the global coronavirus pandemic in 2019 has lasted for nearly two years. According to the theory of stock market psychology, investors' judgment of stock value is mainly based on the reality of subjective reflection. In the event of unforeseen events, the changes of psychological factors will affect the anxiety of investors, affect the stock market, lead to stock price fluctuations, and affect the relevant listed industries and companies in the stock market. Due to the close relationship between the pharmaceutical industry and infectious diseases, the sudden outbreak and rapid spread of coronavirus disease in 2019 will undoubtedly bring great challenges and opportunities to the international pharmaceutical industry.

Research Objects and Methods
According to the number of confirmed cases of coronavirus disease in 2019 published by the World Health Organization, the most seriously affected countries are China, the United States, the United Kingdom, India and Brazil. Based on TVP VAR model, impulse response diagrams with different lag stages and different time points are constructed. Using the daily newly confirmed cases and the pharmaceutical stock index of the most affected countries, this paper analyzes the dynamic spillover effect of coronavirus epidemic in 2019 on the pharmaceutical stock market of the most affected countries in the world. At the same time, it analyzes the correlation between investors' psychological state and venture capital level, especially the factors of investors' anxiety. The reliability and validity of QSC scale revised by Chinese Academy of Sciences were analyzed. The total correlation coefficients of venture capital decision-making, emotional anxiety, job stress and job satisfaction were greater than 0.5. The scale has high reliability. This paper takes emotional labor as independent variable and work pressure as dependent variable to explore the impact of emotional labor on work pressure. There was no significant difference between the experimental group (M = 3.250, SD = 0.684) and the control group (M = 3.222, SD = 0.946); There was no significant difference between the experimental group (M = 3.139, SD = 0.858) and the control group (M = 3.361, SD = 0.559); β A positive value indicates that the level of psychological state has a positive and significant impact on drug investment.

Results
The impulse response diagram results of different lag stages show that the coronavirus disease epidemic in 2019 has a significant positive impact on the returns of pharmaceutical stocks in the UK, China and India. The coronavirus disease epidemic in 2019 mainly had a negative impact on the United States, but its negative impact was short-lived. The coronavirus epidemic in 2019 had a positive impact on Brazil in the early stage and a negative impact in the later stage. The results of impulse response diagrams at different time points show that the impact of the three important time points of the epidemic on the earnings of pharmaceutical stocks in the five countries fluctuates greatly in the early stage and tends to be stable in the later stage.

Conclusion
The severity of coronavirus disease epidemic in 2019, as a global public health emergency, caused great panic all over the world, shook the minds of investors and triggered fluctuations in the stock market. The pandemic has had varying degrees of impact on drug inventory returns in the world's most affected countries. However, with the control of Internet public opinion and the stability of investor sentiment, the fluctuation of pharmaceutical stocks caused by coronavirus epidemic in 2019 will decline over time, but in the short term, the impact is significant. Taking the whole pharmaceutical industry as the research object, this paper can not reflect the impact of coronavirus epidemic in 2019 on different market segments of the pharmaceutical industry stock market, so there are some limitations. However, this study can intuitively reflect the impact of coronavirus disease epidemic in 2019 on the pharmaceutical industry. Based on stock market psychology, this study analyzes the economic psychological and behavioral characteristics of the public under the background of coronavirus epidemic in 2019, which will help to improve the emergency mechanism of China's stock market and formulate phased and differentiated economic incentive policies. It provides a theoretical basis for investors to reasonably deal with stock market fluctuations in an emergency.