Firms and Collective Reputation: a Study of the Volkswagen Emissions Scandal

Ruediger Bachmann, Gabriel Ehrlich, Ying Fan (), Dimitrije Ruzic and Benjamin Leard

No 26117, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper uses the 2015 Volkswagen (VW) emissions scandal as a natural experiment to provide evidence that collective reputation externalities are economically significant. Using a combination of difference-in-differences and demand estimation approaches, we document a spillover effect from the scandal to the non-VW German auto manufacturers. The spillover amounts to an average drop of $2,057 in consumer valuations of these manufacturers’ vehicles and to a 34.6% reduction in their annual sales. We substantiate our interpretation that the estimates reflect a reputation spillover using data on internet search behavior and direct measures of consumer sentiment from Twitter.

JEL-codes: D12 D22 D90 L14 L15 L62 (search for similar items in EconPapers)
Date: 2019-07
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
Note: EFG IO ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Published as Rüdiger Bachmann & Gabriel Ehrlich & Ying Fan & Dimitrije Ruzic & Benjamin Leard, 2023. "Firms and Collective Reputation: a Study of the Volkswagen Emissions Scandal," Journal of the European Economic Association, vol 21(2), pages 484-525.

Downloads: (external link)
http://www.nber.org/papers/w26117.pdf (application/pdf)

Related works:
Journal Article: Firms and Collective Reputation: a Study of the Volkswagen Emissions Scandal (2023)
Working Paper: Firms and Collective Reputation: A Study of the Volkswagen Emissions Scandal (2017)
Working Paper: Firms and Collective Reputation: a Study of the Volkswagen Emissions Scandal (2017)
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:nbr:nberwo:26117

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w26117

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().