- Title
- Changing Stock Market Response to Announcement of Job Loss: Evidence from 1970-1997
- Author(s)
- Henry S. Farber Henry Farber (Princeton University)
- Kevin F. Hallock Kevin Hallock (University of Illinois)
- Abstract
- We report preliminary results of an analysis of the reaction of stock prices to announcements of reductions in force (RIFs) using a large sample of such announcements during the 1970-1997 period collected from the Wall Street Journal index. We find some evidence that the stock market reaction to the announcement of RIFs has become less negative over this period. While a complete understanding of the underlying causes of this finding awaits further research, one possible interpretation is that, over the last three decades, RIF s designed to improve deficiency have become more common relative to RIFs designed to cope with reductions in product demand.
- Creation Date
- 1999-01
- Section URL ID
- IRS
- Paper Number
- 414
- URL
- https://dataspace.princeton.edu/bitstream/88435/dsp01j6731377t/1/414.pdf
- File Function
- Jel
- N66
- Keyword(s)
- job loss, layoffs, downsizing
- Suppress
- false
- Series
- 1