2.2. Literature Review
Zhang and Shaw [1] investigate the content of coronavirus-related research published in the journals indexed in the Science Citation Index Expanded and Social Sciences Citation Index from 2000 to 2020. Furthermore, the textual analysis shows that coronavirus-related research mainly focuses on virology, immunology, epidemiology, and so forth. However, there are few studies that discuss the risk assessment. In addition, in Di Gennaro et al.’s [16] review paper on COVID-19, they focus on the literature about epidemiology, pathophysiology, diagnosis, management, and future perspective, but not the social and economic impacts of COVID-19.
Regarding prior studies on investigating the social impacts of the COVID-19 outbreak, Ahmed et al.’s [17] questionnaire results demonstrate that dental practitioners who are working in the areas where face COVID-19 pandemic threats show a state of anxiety and fear, which suggests that COVID-19 outbreak has a negative effect on sentiment. Similar survey results show in Israeli dentists and dental hygienists [18]. In addition, Auerbach and Miller [19] highlight a severe issue regarding the shortage of mental health professionals due to the coronavirus pandemic. Li et al. [20] and Wang et al. [21] also illustrate that social risks lead to negative psychological consequences with increasing negative emotions. Besides, Chen et al. [22] document that the COVID-19 oriented risk positively affects the behaviors of hand-washing and mask-wearing based on the survey data from primary school students in Wuhan, China. Moreover, He et al. [23] approve the evidence that discrimination and social exclusion occurred after the outbreak of COVID-19.
Regarding prior studies on investigating the economic impacts of COVID-19 outbreak, first, for the cross-country studies, Ashraf [24] finds the growth in the number of country-level confirmed cases of COVID-19 has a negative effect on stock markets based on the 64 countries over the period 22 January to 17 April 2020. In addition, Engelhardt et al. [7] confirm that news attention of COVID-19 associate with the stock markets’ decline. Also, Zhang et al. [4] show that the COVID-19 pandemic leads to an increase in global financial market risks based on the cross-country evidence. Moreover, Liu et al. conduct an event study method and find that stock markets affected by COVID-19 fell quickly after the COVID-19 outbreak. Second, for the single country studies, based on the statistical figure from India, Singh and Neog [25] illustrate that the COVID-19 outbreak leads to an economic contraction in terms of macro-economy, tourism, transportation, stock market, human capital, and trade. Al-Awadhi et al. [3] use Chinese data and find that daily new confirmed COVID-19 cases and deaths negatively affect stock returns. Based on the U.S. daily data Sharif et al. [26] show that COVID-19 leads to oil price volatility shock, economic policy uncertainty, and stock market volatility. Using U.K. data from 2 January to 20 May 2020, Griffith et al. [5] show the impact of COVID-19 on share prices differs from industries.
However, the relationship between the regional continued increasing COVID-19 cases and the firms’ market reaction remains unexplored. Focusing on the early period of the COVID-19 outbreak in China, this study attempts to fill the gap and investigate the negative effect of continued increasing provincial public health threats (driven by COVID-19) on the local firms’ market performance.