A Panel Data Analysis Of Firms’ Behaviors During The Covid-19 Global Pandemic
The proliferated growing number of literature evidences revealed that the Covid-19 global pandemic has negative impacts on global firms’ behaviors in a particular revenue and price. The primary goal of this study is to analyze the firms’ revenue and price from the month of January to October, 2020 (Covid-19 Pandemic Period). The panel data methodology was employed to address the objective of the study, accompanied by theoretical and empirical study evidences. The study findings revealed the significant positive relationships between the firms’ revenue and the price (firms’ behaviors) during the period from January to October the year of 2020.
Key Words: A Panel Data Approach; Firms’ Behaviors; Covid-19 Global Pandemic; Revenue & Price
Introduction and Theoretical Background
Recently literatures evidences shows that the Covid-19 global pandemic has negative and devastated impacts on the drivers of the market structure such as transportation and demand and supply chain which the final outcome of those negative impacts observed in the significant abnormal changes of firms prices and revenue. Considering the fact that the market structure is the core engine of the business firms to operate, the negative impacts of the Covid-19 global pandemic is ultimately well observed in the dramatic changes of firms’ prices and revenue. From this point of view, this study is focusing on analyzing the firms’ behaviors in a particular revenue and price through the panel data approach from the period of January 2020 to October 2020. The analysis of the firms’ behaviors during the Covid-19 global pandemic is well accompanied by the theoretical and empirical study context. In a theoretical context of the study, three theories of epidemic theory, theory of the firm, and industrial organization theory are rigorously employed to address the theoretical part of the study. While in the empirical context of the study, 33 number of retrospective literature reviews were rigorously reviewed to identify the negative impacts of the Covid-19 global pandemic on firms’ behaviors, revenue, and price.
Exemplifying the notion of the Covid-19 global pandemic on the entire firm operations and behaviors, the following literatures play that commitment. In a pragmatic example, (Balleer et al. 2020a), researched on demand and supply in reflection to the price – cutting firms behaviors as a result of the Covid-19 pandemic, the study results mention price cutting behaviors of the firm as the factor pushed by the dramatic increase of revenue from the buyers due to the uncertainty environments of the Covi-19 pandemic. Due to the buyer panic from the risk of the Corona virus, buyers rapidly making changing and focusing on buying in large quintiles which ultimately triggered the increase of revenue of the firms and changing of the behaviors of the firm to address the buyers panic, (Pärson and Vancic 2020). The study of (Pärson and Vancic 2020) reveals that during the Covid-19 pandemic strategic behaviors of the firms were changed to reflect the buyer’ big demand, these firms behaviors were observed through the increase of the price of the goods to meet the buyers panic demand.