Abstract

http://ssrn.com/abstract=2064141
 
 

References (23)



 
 

Citations (2)



 


 



Geography of Firms and Propagation of Local Economic Shocks


Gennaro Bernile


Singapore Management University - Lee Kong Chian School of Business

Stefanos Delikouras


University of Miami

George M. Korniotis


University of Miami

Alok Kumar


University of Miami - School of Business Administration

August 12, 2015


Abstract:     
This study shows that the geographical distribution of publicly-traded firms’ economic activities generates a network that links the U.S. state economies. We begin by examining comovement of financial shocks between connected regions, and find that stock returns and liquidity comove strongly across economically connected states. Then, we show that local macroeconomic shocks propagate across the U.S. via the state-level network resulting from the distribution of firms’ economic activities. These results do not merely reflect the impact of national shocks or industry clustering. Overall, publicly-traded firms appear to be an important transmission conduit of local financial and macroeconomic shocks.

Number of Pages in PDF File: 61

Keywords: Local business cycles, geographical networks, economic links, publicly-traded firms, propagation of recessions

JEL Classification: C23, E32, E37, G10


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Date posted: May 22, 2012 ; Last revised: August 12, 2015

Suggested Citation

Bernile, Gennaro and Delikouras, Stefanos and Korniotis, George M. and Kumar, Alok, Geography of Firms and Propagation of Local Economic Shocks (August 12, 2015). Available at SSRN: http://ssrn.com/abstract=2064141 or http://dx.doi.org/10.2139/ssrn.2064141

Contact Information

Gennaro Bernile
Singapore Management University - Lee Kong Chian School of Business ( email )
50 Stamford Road
Level 4
Singapore, 178899
Singapore
+65-68085478 (Phone)

Stefanos Delikouras
University of Miami ( email )
Coral Gables, FL 33124
United States
George M. Korniotis
University of Miami ( email )
P.O. Box 248094
Coral Gables, FL 33124-6552
United States
305-284-5728 (Phone)
Alok Kumar (Contact Author)
University of Miami - School of Business Administration ( email )
514 Jenkins Building
Department of Finance
Coral Gables, FL 33124-6552
United States
305-284-1882 (Phone)
HOME PAGE: http://moya.bus.miami.edu/~akumar
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