Stock Market Performance of Jewish Firms During the Third Reich

51 Pages Posted: 11 Dec 2019

See all articles by Jens Ihlow

Jens Ihlow

University of Konstanz - Faculty of Economics and Statistics

Jens Carsten Jackwerth

University of Konstanz - Department of Economics

Date Written: December 9, 2019

Abstract

We study the effect of discrimination against Jewish managers and owners on their firms' stock during the Third Reich. The stock of firms with Jewish managers underperformed by around 5% annually, with abnormal performance persisting on average for three years until firm "Aryanization." Firms with Jewish owners perform much like firms without any Jewish involvement. We identify harassment of Jewish-managed firms as the leading cause for the discount. Alternative explanations, such as brain drain and Jewish stigma, seem less relevant. We find that discriminating against a minority can have a negative effect on an entire economy.

Keywords: Third Reich, Hitler, Jewish Firms, Discrimination, Aryanization, Abnormal Performance

JEL Classification: G12, G14, N24

Suggested Citation

Ihlow, Jens and Jackwerth, Jens Carsten, Stock Market Performance of Jewish Firms During the Third Reich (December 9, 2019). Available at SSRN: https://ssrn.com/abstract=3501557 or http://dx.doi.org/10.2139/ssrn.3501557

Jens Ihlow (Contact Author)

University of Konstanz - Faculty of Economics and Statistics ( email )

Universitaetsstr. 10
78457 Konstanz
Germany

Jens Carsten Jackwerth

University of Konstanz - Department of Economics ( email )

Universitaetsstr. 10
Konstanz, 78457
Germany
+497531882196 (Phone)
+497531883120 (Fax)

HOME PAGE: http://cms.uni-konstanz.de/wiwi/jackwerth/

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