COVID-19, a blessing in disguise for the Tech sector: Evidence from stock price crash risk

Ashrafee T. Hossain, Abdullah-Al Masum and Jian Xu

Research in International Business and Finance, 2023, vol. 65, issue C

Abstract: In this paper we document that although COVID-19 has brought uncertainties to the overall economy, the Technology (tech) sector is the systematic beneficiary of the pandemic. Using a quasi-natural setup, we find a significant notion that the Stock Price Crash Risk (SPCR) of firms within the Tech sector decreases during the COVID-19 pandemic compared to the recent past and firms belonging to other sectors. Our analyses further reveal that firms in the Tech sector with stronger external monitoring and better information environment receive an even greater advantage from the pandemic. Overall, our study suggests that the higher systemic dependency on the Tech sector during the COVID-19 outbreak results in an economic benefit for this sector.

Keywords: COVID-19; Uncertainty; Stock price crash risk; Tech sector (search for similar items in EconPapers)
JEL-codes: G10 G30 L16 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:65:y:2023:i:c:s0275531923000648

DOI: 10.1016/j.ribaf.2023.101938

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