Resilience and Asset Pricing in COVID-19 Disaster
The COVID-19 pandemic potentially affected stock prices in two non-mutually exclusive ways: discount rates and cash flows. This paper focuses on the latter and analyzes it through the lens of an asset-pricing model. It shows how workplace resilience and financial resilience interacted and significan...
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| Format: | Article |
| Language: | English |
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MDPI AG
2025-05-01
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| Series: | Economies |
| Subjects: | |
| Online Access: | https://www.mdpi.com/2227-7099/13/5/123 |
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| Summary: | The COVID-19 pandemic potentially affected stock prices in two non-mutually exclusive ways: discount rates and cash flows. This paper focuses on the latter and analyzes it through the lens of an asset-pricing model. It shows how workplace resilience and financial resilience interacted and significantly affected asset prices. The model-based equity premium increases with the probability of a disaster. The results suggest the significant amplification of workplace resilience by financial resilience. Specifically, the dividend growth of low-resilience firms is significantly more responsive to workplace flexibility and suffers more severely than that of high-resilience firms. |
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| ISSN: | 2227-7099 |