The COVID-19 pandemic and shareholder value: impact and mitigation

Maximilian Klöckner, Christoph G. Schmidt and Stephan M. Wagner

International Journal of Production Research, 2023, vol. 61, issue 8, 2470-2492

Abstract: The financial implications of the worldwide COVID-19 pandemic and the effective mitigation of the negative effects are the subject of an ongoing debate. We aim to empirically substantiate this debate. Based on a sample of 4,032 publicly traded U.S. and Chinese firms, we conduct an event study and find that the COVID-19 pandemic is associated with a substantial decrease in shareholder value, significantly varying between U.S. and Chinese firms and across industries. We further identify structure- and supply chain-related firm factors that mitigate the negative impact. Specifically, we find that smaller firms experience a less negative impact on shareholder value, challenging established findings. Our results also suggest that a lower dependence on physical assets, a shorter trade cycle, and a higher degree of vertical integration attenuate the negative impact on shareholder value. Our findings provide important insights for managers and policymakers. We recommend managers to reduce the dependency on business models that strongly rely on physical assets, to streamline trade cycles, and to reduce supply chain complexity. From a policy perspective, we emphasise the importance of more industry-specific granularity of public support measures.

Date: 2023
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/00207543.2022.2147235 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:tprsxx:v:61:y:2023:i:8:p:2470-2492

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/TPRS20

DOI: 10.1080/00207543.2022.2147235

Access Statistics for this article

International Journal of Production Research is currently edited by Professor A. Dolgui

More articles in International Journal of Production Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().