The impact of weather-induced moods on M&amp;A performance

Tunyi, Abongeh A.; Machokoto, Michael

doi:10.1016/j.econlet.2021.110011

Cited by 9 publications

(6 citation statements)

References 20 publications

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“…To address this concern, we also present results using different pre-event window periods. Following MacKinlay (1997), Tunyi and Machokoto (2021), we used short-run event windows to minimize noise resulting from confounding events. The main assumption of MacKinlay (1997) is that even if there is some noise, this will be random and, on average, the noise will cancel out if we use a large enough sample.…”

Section: Methodsmentioning

confidence: 99%

Deglobalization and the value of geographic diversification: evidence from Brexit

Hussain

Tunyi

Areneke

2023

IJMF

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PurposeThis paper aims to explore the value of geographic diversification in the context of deglobalization, drawing evidence from a quasi-natural experiment – the Brexit referendum that took place on 23 June 2016 in the UK.Design/methodology/approachThis study applies an event study methodology to estimate the impact of the Brexit vote on a cross-section of firms with varying levels of geographic diversification – undiversified UK firms, UK firms with significant operations in the European Union (EU) and globally diversified UK firms. This study deploys a Heckman two-stage regression approach to address sample selection bias.FindingsThis study finds that undiversified UK firms experienced negative cumulative abnormal returns (CARs) around the Brexit referendum. The value of UK firms with majority sales within the UK declined by 0.9 percentage points, on average, in the three days centred on the Brexit referendum. In contrast, UK firms that are globally diversified, with the majority of sales within the EU are unaffected, while diversified firms in the rest of the world generated positive CARs of 1.8 percentage points over the same period. These results are robust to firm characteristics, selection bias and alternative measures of CARs and diversification.Research limitations/implicationsThis study is subject to some limitations that open avenues for future work. There are a few available proxies of diversification and further work on developing other proxies is much needed. Further work may also examine the long-term impact of diversification on UK firms. This study considered Brexit as a quasi-natural experiment, and this study could be applied to other deglobalization events like COVID-19 and can enhance the generalizability of diversification strategy in the deglobalized world. Findings may stimulate future work to explore how another form of diversification – product diversification has affected firm returns around Brexit. Finally, this study has focused on the UK as its base case. It may be interesting to corroborate the findings by exploring the impact of Brexit on European firms, who hitherto Brexit, had some operations in the UK.Practical implicationsThis work offers some insights for policymakers and regulators around the impact of deglobalization on local firms. Findings suggest that these trends significantly negatively impact the most vulnerable firms (smaller firms with less global reach), while their larger counterparts with significant global reach might be insulated. This finding is important for determining the nature of support needed by different firms in times of deglobalization. The work also offers insights to managers of firms operating in countries where there are real prospects of deglobalization. Specifically, the work highlights the importance of geographic diversification when free movement of goods, services and people is restricted.Originality/valueThis study shows that a certain group of globally diversified firms earned significantly higher returns from the prospect of the UK leaving the EU, thereby highlighting the value of geographic diversification in a time of deglobalization.

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Section: Methodsmentioning

confidence: 99%

Deglobalization and the value of geographic diversification: evidence from Brexit

Hussain

Tunyi

Areneke

2023

IJMF

Self Cite

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“…Consumers' risk tolerance diminishes during unfavorable weather periods [25], thereby resulting in increased risk aversion awareness [89][90][91] and subsequently causing deviations in consumption plans [79]. Shafi and Mohammadi [90] regarded cloud cover as a proxy for weather conditions and found that weather-induced risk aversion leads to a reduction in consumer contributions to crowdfunding activities.…”

Section: Influence Of Weather Factors On Risk Aversion Awarenessmentioning

confidence: 99%

Does the Weather Still Affect Me When I Shop at Home? The Impact of Weather on Online Shopping Behavior

Liu,

Wang,

Zhang

et al. 2024

Preprint

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Previous studies have acknowledged the impact of weather changes on retail uncertainty. They primarily focus on understanding how weather conditions affect offline consumer behavior and aiming to develop effective marketing strategies. However, there is little research on the complex impact of weather on online shopping behavior. To bridge this gap, we conduct a study with a sample of 261 consumers from China with shopping experience in Community Retail Shops (CRSs). We utilize the S-O-R model and theories including meteorological emotional effect theory, emotional coherence and meteorological psychology to propose and validate models elucidating the relationship between weather and consumers' online shopping behavior in CRS. Our findings reveal that weather conditions affect consumers' spending patterns and purchase diversity, mediating by consumers' emotion and risk aversion, when they comfortably shop online at home. Furthermore, employing the fsQCA model, we identify the critical path through which weather conditions and consumer types influence risk aversion awareness. The results provide management implications for retailers to develop online marketing strategies for different consumer types.

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“…Nonetheless, the nexus is varied for groups of investors and seasons as the mature investors' decision-making process of investment is less influenced by the weather-induced mood. In terms of M&A performance, negative weather-induced mood states limit managerial overconfidence and arrogance of UK listed firms, which lowers overpaying behaviours and enhances acquiring performance [ 38 ]. As a result, it is possible that mood acts as a mediator between the weather and investors' behaviours, which will reflect on stock market outcomes.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Does weather anomaly still affect the emerging stock market under the unexpected event? New evidence from the COVID-19 pandemic

Hong,

Huong,

Linh

2023

Heliyon

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The impact of weather-induced moods on M&A performance

Cited by 9 publications

References 20 publications

Deglobalization and the value of geographic diversification: evidence from Brexit

Deglobalization and the value of geographic diversification: evidence from Brexit

Does the Weather Still Affect Me When I Shop at Home? The Impact of Weather on Online Shopping Behavior

Does weather anomaly still affect the emerging stock market under the unexpected event? New evidence from the COVID-19 pandemic

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