Cardiff University | Prifysgol Caerdydd ORCA
Online Research @ Cardiff 
WelshClear Cookie - decide language by browser settings

Staring death in the face: the financial impact of corporate exposure to prior disasters

Tosun, Onur Kemal ORCID:, Eshraghi, Arman ORCID: and Muradoglu, Gulnur 2021. Staring death in the face: the financial impact of corporate exposure to prior disasters. British Journal of Management 32 (4) , pp. 1284-1301. 10.1111/1467-8551.12539

[thumbnail of 1467-8551.12539.pdf] PDF - Published Version
Available under License Creative Commons Attribution.

Download (419kB)


We examine how firms’ exposure to prior disastrous events can influence their stock market footprint during the coronavirus crisis. While others have drawn comparisons between past pandemics and Covid-19, we argue that such comparisons are skewed due to the unprecedented reach and consequences of the latter. To better model the structural shock caused by Covid-19 in the USA, we look at the 9/11 terrorist attacks and specifically examine how firms based in New York City back then reacted to the associated financial turmoil. While 9/11 and Covid-19 are categorically different events, their short-term impacts on the stock market, and on New York exchanges in particular, are surprisingly similar. We find firms that financially ‘survived’ 9/11 also managed to do better – or suffer less – by about 7% in terms of stock returns during Covid-19, compared to control firms that were not exposed to 9/11. In a sense, we show that companies’ prior exposure to 9/11 partly ‘immunized’ them against the consequences of a similarly destabilizing event, albeit two decades later. Interestingly, the trading volume of exposed firms increased due to market buying pressures. Our analysis is robust to various financial proxies, alternative definitions of control firms and varying estimation windows.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Additional Information: This is an open access article under the terms of the Creative Commons Attribution License
Publisher: Wiley
ISSN: 1045-3172
Date of First Compliant Deposit: 10 June 2021
Date of Acceptance: 10 June 2021
Last Modified: 03 May 2023 06:54

Citation Data

Cited 4 times in Scopus. View in Scopus. Powered By Scopus® Data

Actions (repository staff only)

Edit Item Edit Item


Downloads per month over past year

View more statistics