The Discussion on the Impact of the COVID-19 Epidemic on the Macro-economy and the Establishment of the Work and Production Resumption Model

Abstract

In order to explore the impact of the COVID-19 epidemic on the macro-economy, this paper established the IS-LM model and the AD-AS model, made corresponding adjustments and calculations to the models, analyzed the impact of the epidemic on aggregate demand and aggregate supply respectively, and put forward policy suggestions according to the actual situation by using the models. And in order to help the government better decide the best timing to return to work and production in different industries, this article utilized the total cost model in epidemic control to build a work resumption coefficient evaluation model of different industries, getting the coefficients of the high-density population industry, the industry whose work resumption can be carried out online, the industry of fewer average interactions, highly mechanized industry and special industries, respectively. And we formulated the standard of work resumption based on the work resumption coefficient under the condition of controlling the total cost to be minimized. After getting the work resumption coefficients of different industries and corresponding resumption standard, the government will be easier to balance the cost of the shutdown and the risk of resuming work and production under the epidemic.