{"id":119020,"date":"2020-10-29T13:30:09","date_gmt":"2020-10-29T12:30:09","guid":{"rendered":"https:\/\/www.erasmusmagazine.nl\/en\/?p=119020"},"modified":"2025-12-19T11:25:11","modified_gmt":"2025-12-19T10:25:11","slug":"corona-science-this-is-a-good-reason-to-do-more-to-contribute-to-the-public-debate","status":"publish","type":"post","link":"https:\/\/www.erasmusmagazine.nl\/en\/2020\/10\/29\/corona-science-this-is-a-good-reason-to-do-more-to-contribute-to-the-public-debate\/","title":{"rendered":"Corona science: ‘This is a good reason to do more to contribute to the public debate’"},"content":{"rendered":"

Mathijs van Dijk, professor of Finance at the Rotterdam School of Management, is researching the impact of Covid-19 on the banking sector, together with colleagues Dirk Schoenmaker and Henk Jan Reinders. “By analysing changes in the stock market, we are able to draw conclusions about the economic repercussions of the pandemic for European banks”, says Van Dijk.<\/p>\n

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Why is this research relevant now?<\/strong><\/p>\n

\u201cBanks play a crucial role in keeping the economy going, so if they really do get into trouble, the economic damage may be even greater than what we expect right now. If businesses are unable to repay loans because of the crisis, that will have implications for the criteria that banks will subsequently set when it comes to issuing new loans. Banks are often slow to discover any arrears, while the stock market is a quicker and more up-to-date way of seeing what is actually happening to companies and, consequently, to banks. By mapping out the actual economic damage to banks as early as possible, we hope that Dutch and European regulators will be able to intervene in time.\u201d<\/p>\n

What motivates you to do research on the impact of Covid-19?<\/strong><\/p>\n

\u201cI enjoy my work as a scientist because I am able to learn and research new things. I\u2019ve been working for the EUR for some twenty years by now and, in addition to teaching, I have mainly focused on relatively pure science. But I now feel the urge to explore the social impact more. I have a fairly specialised field and that has its limitations; my research is published somewhere in a journal and only a few dozen people around the world actually read it. It is useful, but before it has an impact anywhere, it can take years and can be very indirect. Nowadays, I mainly enjoy looking at how my expertise can contribute more to the public debate, and this happens to be a really good reason to do that.\u201d<\/p>\n\n\t

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\n\t\t\u2018Some serious losses had been predicted for the European banking sector, but the surprising thing is that share prices have already recovered significantly since April\u2019\n\t<\/blockquote>\n\n\t<\/figure>\n\t\t<\/div>\n\t<\/div>\n

How do you manage to carry out research during a pandemic?<\/strong><\/p>\n

\u201cOur research is based on data gained from share prices and banks. We run statistical analyses on these data, which you can basically carry out on your laptop from anywhere. The only influence the pandemic is having, is the fact that we are now meeting up online as researchers.\u201d<\/p>\n

What hypothesis do you base this research on?<\/strong><\/p>\n

\u201cWe expected banks to be hit hard by the crisis due to the pandemic. Meanwhile, we have been working on the study for several months and the data for March and April have confirmed this theory. Some serious losses had been predicted for the European banking sector, but the surprising thing is that share prices have already recovered significantly since April. There is a lot of discussion as to why those share prices have rebounded so well while the economic crisis is still going on. That question also forms a part of our research.\u201d<\/p>\n

What has changed in the stock market in the wake of the pandemic?<\/strong><\/p>\n

\u201cIn March, when the pandemic first hit, stock prices plummeted dramatically by about a third. That is huge and you hardly ever see that happen, given that it meant that one third of the economic value of Dutch companies practically disappeared overnight. When the lockdown was announced, a substantial positive adjustment played out on the market. This suggests that the stock market as a whole estimated that the corona measures were good for the economy in the long term. That makes for an interesting discussion about competition between healthcare and the economy.\u201d<\/p>\n\n\t

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