Firm-Level Exposure to Epidemic Diseases: COVID-19, SARS, and H1N1

Abstract We construct text-based measures of the primary concerns listed firms associated with the spread of COVID-19 and other epidemic diseases. We identify which firms perceive to lose or gain from a given epidemic and textually decompose the epidemic’s effect on the firm’s demand and supply. We...

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Bibliographic Details
Published in:The Review of financial studies 2023-12, Vol.36 (12), p.4919-4964
Main Authors: Hassan, Tarek A, Hollander, Stephan, van Lent, Laurence, Schwedeler, Markus, Tahoun, Ahmed
Format: Article
Language:English
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Summary:Abstract We construct text-based measures of the primary concerns listed firms associated with the spread of COVID-19 and other epidemic diseases. We identify which firms perceive to lose or gain from a given epidemic and textually decompose the epidemic’s effect on the firm’s demand and supply. We find that the effects of COVID-19 manifest as a simultaneous shock to demand and supply, with both shocks affecting firms’ market valuations in equal measure on average. By contrast, demand-related impacts appear more important in accounting for the observed collapse in firm-level investment during the COVID-19 crisis. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online
ISSN:0893-9454
1465-7368
DOI:10.1093/rfs/hhad044