Tony Berrada wins the Best Paper Award at the World Finance Conference
GFRI's Professor Tony Berrada's paper "COVID-19 Puzzles: A Resolution" won the Best Paper Award at the World Finance Conference (the University of Turin, Italy, August 1-3, 2022).
This paper examines the economic impact of COVID-19 in an equilibrium framework. The authors' model, BDRA-SSL, combines two ingredients: (i) beliefs-dependent preferences for economic dynamics and (ii) stochastic SEIRD model with unpredictable birth and vaccine discovery events, and mitigating policy and behavioral responses, for disease propagation. They estimate the model based on economic time series and COVID-19 data. They show it explains the behaviors and levels of the S&P 500, the index volatility, and the number of new cases during the recent outbreak, while providing a good match for 25 unconditional moments of economic time series. Beliefs-dependence emerges as a critical ingredient for this comprehensive explanation of short term dynamics during the COVID-19 outbreak and of long run statistical properties. A comparison study establishes the performance of BDRA-SSL versus alternative specifications.
The paper was co-authored with Jerome Detemple and Marcel Rindisbacher from Boston University Questrom School of Business; Center for Interuniversity Research and Analysis on Organization (CIRANO).
Mar 2, 2023