The Asian crisis and the exposure of large U.S. firms

William Emmons and Frank A. Schmid

Review, 2000, vol. 82, issue Jan, 15-34

Abstract: A deep financial and economic crisis ravaged many Asian nations during 1997 and 1998. In this article, William Emmons and Frank Schmid examine the impact of the crisis on corporate risk for a subset of large U.S. firms that are included in the S&P 100 stock-market index. They find that the Asian crisis changed many of these firms' exposure to stock-market movements-that is, their \\"betas\\" or sensitivity to stock-market risk. In particular, the extent of a firm's sales exposure to Asia appears to be an important link through which the crisis affected beta. This effect is amplified by greater financial leverage.

Keywords: Stock - Prices; Financial crises - Asia (search for similar items in EconPapers)
Date: 2000
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