spookythingsheep-blog

[spookythingsheep-blog]

Economic concepts under the global pandemic---COVID-19

Introduction:

Starting from the year of 2019, a global pandemic--COVID 19 was outbreak in Wuhan, China, causing difficulties for job seekers, leading to a dramatic  currency float and turbulence in stock markets. In this Econ live project, me and my group members are going to apply economic concepts to our daily life under the pandemic through different aspects. 

Mask(Fanqing Liu):

Wuhan, the emergence of a new coronavirus epidemic has led to the development of the "mask economy".

Mask is a common item in our daily life, from the virus protection effect: medical protection mask (N95 ≈ KN95) > medical surgical mask > ordinary medical mask (including medical care, disposable medical mask, etc.) > other mask shape protection items (cotton gauze protection mask, windproof warm mask, etc.) > do not wear a mask face naked out.

In January, Wuhan was hardest hit by the epidemic, and the lack of medical supplies, coupled with the speed of the spread of the epidemic, led to the start of the year with the "mask economy" riding the wave of success, opening the door for the "GDP" to send a big economic account.

The "mask economy" is a terminal hub in an industrial economic chain.

The industrial chain is a balanced process containing four dimensions of value chain, enterprise chain, supply and demand chain and spatial chain docking each other, and this "docking mechanism" is the internal mode of industrial chain formation.

The increase in the price of raw material suppliers is bound to drive the change in the price of the end product in the market, because the commodity must be profitable. Commodities as products through raw materials to deep processing packaging to market sales, the value generated is his profit to sellers and buyers of goods

Firstly, ethical economy refers to the economic form in which market economic agents consciously comply with ethical norms and use ethical values to guide their economic behavior.

"Low price import covers high price sell", although this is a normal phenomenon in the law of commodity value, who holds the resources, who has the price guidance. However, with national disaster wealth, he is bound to be a moral economy, the most impermissible economic growth point. Moral degeneration of businessmen, "moral kidnapping" at the moment is necessary to kidnap businessmen, before the great disaster, the people of the country should be united, united to fight the epidemic. At present, the State Administration of Market Supervision for the high price of the sale of business, respectively, to inform the punishment.

Secondly, the "show economy" is a collective or individual intentional "sticky economy" in this mask economy, which earns heat by attaching to the hot body and gaining attention. Whether it's a business plan or a personal interest to find the best model, it's the simplest way to get the value of adhesion, that is, the economic benefits of the value chain behind it, and here I call it the "later economy". In the show economy, whether it is the current celebrity public welfare fundraising or individual fundraising, they are all using their only power to do what they can give for free. The "Han Hong Public Welfare Body" public welfare model of charity development, as a public entertainer, really goes to the front line to help.

Interest driven, the signals that people are now releasing through this layer of the Internet economy is what the audience sees through the medium. Most of the public will not see the interest groups behind the phenomenon. "The information of 3.4 million pieces of masks in the Case Western Reserve University incident led to the audience spreading the information by mouth, but the ending was an empty one, which deserves our reflection and condemnation of the parties involved in the incident.

The development of the "mask economy" chain is inevitable, the good interaction between moral economy and market economy, in the face of a catastrophe, the value of the interests highlighted is the national interests highlighted, not to send national disaster wealth, is the spirit of the Chinese people should have.

Economic value realization is certainly important, but to have a correct value orientation to obtain the optimal value of profits.

In economics, when there is a significant increase in the price of a product, it is possible to seek alternatives that have the same use value.

Food (Zoe):

It is obvious when I take a look at food prices, the supply of food is decreasing, the price and demand are increasing due to the pandemic. Starting with the food delivery fees on uber eats. Although the fees for taxation and delivery might be varied due to the price of food, the service fees are relatively higher especially during the pandemic. This means that food can be considered price inelastic since an increase in price will not lead to a significant drop in demand since consumers have no choice but to purchase the food. 

From the graph below, results showing that the demand for fresh vegetables was generally inelastic with respect to changes in own prices, and cross-price effects for most fresh vegetables were negligible. During COVID-19 I found out some of the food  prices have increased but still got sold out quickly, that illustrate an economic concept that food as a general category is inelastic as the picture shown, increase in price lead to smaller change. Relating to my Uber delivery price observation that although the price of service fee increases, people may still purchase delivery foods.  

Entertainment Consumption(Nathan):

Due to the impact of the epidemic, people have changed their daily travel mode and stayed at home most of the time for safety reasons. As a result, the old structure of entertainment spending on daily outings has changed greatly. Online consumption began to show a peak growth, compared to offline consumption showed a cliff decline. Where people used to sing, watch movies and shop offline, most of them have now moved online.Looking at the collected data, it can be seen that in China, many apps offer continuous monthly/annual discounts, such as Youku, Bilibili, iQIYI, etc.

In the US and Europe, YouTube is the clear winner for the majority of age groups, and while TikTok and Snapchat are better places to advertise products relevant to Gen Z, millennial consumers are better off using Instagram Live or Facebook Watch.

Therefore, a large number of businesses spend the largest proportion of their advertising on YouTube.Because people can't go out, they will spend a lot of time browsing and watching videos. Businesses have also seized the opportunity to flood YouTube with ads that can also be seen on Instagram or Twitter.

Not only watching videos, online singing, and takeout have opened a recharge member system.This was also a big revenue stream for the company during the epidemic. You can enjoy additional value-added services or better treatment by repaying your membership.

Thank you!

Group Members: Zihui(Zoe)Zhuang 17225920, Jingjie(Nathan)Zhang 13485502, Fanqing Liu 79734983