Open Access Open Access  Restricted Access Subscription Access

System Dynamics Modeling to Understand the Impact of Covid-19 on Indian Economy


Affiliations
1 Subject Matter Expert, upGrad, India
2 Assistant Professor, SBM, Noida International University, India
3 M.Phil. Scholar, SBM, Noida International University, India
 

COVID-19 has led to a severe health crisis. This sudden and wide impact of corona virus has brought the global economy to its knees. The virus has spread across the world through the chain of transmission. In India, the first case of COVID-19 was reported in the month of February 2020 and has spread drastically within past four months. As a preventive measure, the government announced complete lockdown in the month of March 2020 to stop this pandemic situation in India (Suri, April 30, 2020). This invisible virus has compelled many business organizations to shutdown their respective activities and to follow social distancing norms. The outbreak of COVID-19 has disrupted the Chinese economy first and then it led to affect global economy. This paper models the impact of COVID-19 on Indian economy (Sansa, 2020). The researcher shows the impact using System Dynamics modeling approach. The causal loop diagram was used to explain the causality of series of events. The results show that the strategy of shutdown/lockdown tends to increases the unemployment and ultimately causes negative impact on Indian Economy. In order to revive economy, we recommends, that the focus to be shifted on the factors such as new startups, Government relief funds, development of COVID-19 vaccine, generating employment and better health care facilities to reduce the spread of COVID-19 and strengthen Indian economy.



Keywords

COVID-19, Indian economy, Employment, Lockdown, System Dynamics, Causal loop, Stock flow
User
Notifications
Font Size

  • Abodunrin, O., Oloye, G., & Adesola, B. (2020). Coronavirus pandemic and its implication on global economy. International Journal of Arts, Languages and Business Studies, 4.
  • AÇIKGÖZ, Ö., &GÜNAY, A. (2020). The early impact of the Covid-19 pandemic on the global and Turkish economy. Turkish journal of medical sciences, 50(SI-1), 520-526.
  • Bahri, M. (2020). The nexus impacts of the Covid-19: A qualitative perspective.
  • Boissay, F., & Rungcharoenkitkul, P. (2020). Macroeconomic effects of Covid-19: an early review (No. 7). Bank for International Settlements.
  • Carlsson-Szlezak, P., Reeves, M., & Swartz, P. (2020). What coronavirus could mean for the global economy. Harvard Business Review, 3.
  • Dev, S. M., & Sengupta, R. (2020). Covid-19: Impact on the Indian economy. Indira Gandhi Institute of Development Research, Mumbai April.
  • Fernandes, N. (2020). Economic effects of coronavirus outbreak (COVID-19) on the world economy. SSRN 3557504.
  • Forrester, J. W. (1994). System dynamics, systems thinking, and soft OR. System dynamics review, 10(2‐3), 245-256.
  • Gandhi, V., Syed, A. A., & Jain, S. K. (2021). A study of performance indicators of Technology Business Incubators(TBIs) in India. Management Dynamics, 21(1), 14-23.
  • Gern, K. J., & Mösle, S. (2020). The impact of the COVID-19 pandemic on the global economy: Survey-based evidence from free zones (No. 139). Kiel Policy Brief.
  • Gupta, A. (2020, May 19). Coronavirus (COVID-19) And Indian Economy - Coronavirus (COVID19) - India.
  • Inoue, H., & Todo, Y. (2020). The propagation of the economic impact through supply chains: The case of a mega-city lockdown against the spread of COVID-19. Available at SSRN 3564898.
  • Jaswal, N. (2020). COVID 19–IMPACT ON PUBLIC HEALTH AND ECONOMY OF THE NATION. Purakala with ISSN 0971-2143 is an UGC CARE Journal, 31(12), 346-350.
  • Kalakata, A. (2021). Flipkart: Driving Ecommerce During COVID-19. Management Dynamics, 21(1), 07-13.
  • Kumar, H., Pillai, S. V., & Vipin, H. (2020). Impact of Age and Social Distancing on COVID-19 Epidemic in India. Management Dynamics, 20(2), 18-29.
  • Loayza, N. V., & Pennings, S. (2020). Macroeconomic policy in the time of COVID-19: A primer for developing countries.
  • Mishra, A., & Shukla, A. (2020, December), Psychological Determinants of Consumer’s Usage, Satisfaction, and Word-of-Mouth Recommendations Toward Smart Voice Assistants. In International Working Conference on Transfer and Diffusion of IT (pp. 274-283). Springer, Cham.
  • Mishra, A., Shukla, A., & Sharma, S. K. (2021a). Psychological determinants of users’ adoption and word-of-mouth recommendations of smart voice assistants. International Journal of Information Management, 102413. (A* category + scopus)
  • Mishra, A., Shukla, A., Rana, N. P., & Dwivedi, Y. K. (2021b). From “touch” to a “multisensory” experience: The impact of technology interface and product type on consumer responses. Psychology & Marketing, 38(3), 385-396. (‘A’ category + scopus) Mishra, M. K. (2020). The World after COVID-19 and its impact on Global Economy.
  • Nyanga, T., Zirima, H., & Mashavira, N. (2020). Withering COVID 19 Storm: Survival Strategies Employed by Informal Traders in Masvingo Urban, Zimbabwe. Management Dynamics, 20(1), 01-09.
  • Ozili, P. K., & Arun, T. (2020). Spillover of COVID-19: impact on the Global Economy. SSRN 3562570.
  • Pandey, S., & Bajaj, R. (2020). A Study on Upcoming Global Human Resource Challenges and Concerns during COVID-19 Outbreak. Management Dynamics, 20(1), 10-17.
  • Panwar, T., & Khan, K. (2020). Social Listening: A Strategy to Bond with the New Age Customers.
  • Management Dynamics, 20(2), 1-5.
  • Rastogi, A. S. (2020, May 20). The New Normal: Analysis of COVID-19 Impact on the Indian Economy.
  • Ruiz Estrada, M. A. (2020, A). COVID-19: Economic Recession or Depression? Available at SSRN 3575881.Koirala, J., & Acharya, S. (2020). Impact of Novel Corona Virus (COVID-19 or 2019-nCoV) on Nepalese Economy. Available at SSRN 3560638.
  • Ruiz Estrada, M. A. (2020, B). Economic Waves: The Effect of the Wuhan COVID-19 On the World
  • Economy (2019-2020). Available at SSRN 3545758.
  • Sansa, N. A. (2020). The Impact of the COVID-19 on the Financial Markets: Evidence from China and
  • USA. Electronic Research Journal of Social Sciences and Humanities, 2.
  • Shukla, A. (2020). Impact of Technology on Child Psychology During COVID-19. Management
  • Dynamics, 20(2), 6-9.
  • Shukla, A., & Mishra, A. (2021). Effects of Visual Information and Argument Concreteness on
  • Purchase Intention of Consumers Towards Online Hotel Booking. Vision, 09722629211038069. (‘C’
  • category+ scopus)
  • Shukla, A., & Sharma, S.K, (2018), Evaluating Consumer’s Adoption of Mobile Technology for Grocery Shopping: An Application of Technology Acceptance Model, Vision– The Journal of Business Perspective, SAGE publication,22(2), 185-198, ISSN 0972-2629. (C category + Scopus)
  • Shukla, A., Kushwah, P., Jain, E. and Sharma, S.K. (2021), Role of ICT in emancipation of digital entrepreneurship among new generation women, Journal of Enterprising Communities: People and Places in the Global Economy, https://doi.org/10.1108/JEC-04-2020-0071 ( C Category + Scopus)
  • Sterman, J. D. (1992). System dynamics modelling for project management.
  • Su kowski. (2020). Covid-19 pandemic; recession, virtual revolution leading to de-globalization? Journal of Intercultural Management, 12(1), 1-11.
  • Suri, I. S. (April, 30, 2020). Impact of COVID 19 on Indian Economy and Road Ahead for Corporate Sector.

Abstract Views: 77

PDF Views: 19




  • System Dynamics Modeling to Understand the Impact of Covid-19 on Indian Economy

Abstract Views: 77  |  PDF Views: 19

Authors

Anuja Shukla
Subject Matter Expert, upGrad, India
Neha Tomer
Assistant Professor, SBM, Noida International University, India
Preeti Singh
M.Phil. Scholar, SBM, Noida International University, India

Abstract


COVID-19 has led to a severe health crisis. This sudden and wide impact of corona virus has brought the global economy to its knees. The virus has spread across the world through the chain of transmission. In India, the first case of COVID-19 was reported in the month of February 2020 and has spread drastically within past four months. As a preventive measure, the government announced complete lockdown in the month of March 2020 to stop this pandemic situation in India (Suri, April 30, 2020). This invisible virus has compelled many business organizations to shutdown their respective activities and to follow social distancing norms. The outbreak of COVID-19 has disrupted the Chinese economy first and then it led to affect global economy. This paper models the impact of COVID-19 on Indian economy (Sansa, 2020). The researcher shows the impact using System Dynamics modeling approach. The causal loop diagram was used to explain the causality of series of events. The results show that the strategy of shutdown/lockdown tends to increases the unemployment and ultimately causes negative impact on Indian Economy. In order to revive economy, we recommends, that the focus to be shifted on the factors such as new startups, Government relief funds, development of COVID-19 vaccine, generating employment and better health care facilities to reduce the spread of COVID-19 and strengthen Indian economy.



Keywords


COVID-19, Indian economy, Employment, Lockdown, System Dynamics, Causal loop, Stock flow

References