The impact of Wayfair vs. South Dakota on retailers: an event study

Euikyu Choi (), Wei Du () and Caitlin Riley ()
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Euikyu Choi: West Chester University of Pennsylvania
Wei Du: West Chester University of Pennsylvania
Caitlin Riley: West Chester University of Pennsylvania

Economics Bulletin, 2021, vol. 41, issue 3, 1180-1186

Abstract: We study the impact of the supreme court ruling of Wayfair vs. South Dakota on the retailing industry. We do so by examining financial market reactions to the ruling. Specifically, we find positive abnormal returns for local retailers and insignificant results for online retailers. Our results are consistent with the notion that the supreme court ruling benefited the local retailers due to the removal of the tax loophole that put them at a disadvantage versus online retailers.

Keywords: sales tax; retailers; competition; stock returns (search for similar items in EconPapers)
JEL-codes: G3 L8 (search for similar items in EconPapers)
Date: 2021-07-18
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