The Future of Work: Work from Home Preparedness and Firm Resilience During the COVID-19 Pandemic

20 Pages Posted: 2 Jun 2020

See all articles by John (Jianqiu) Bai

John (Jianqiu) Bai

Northeastern University - D'Amore-McKim School of Business

Wang Jin

Massachusetts Institute of Technology (MIT)

Sebastian Steffen

MIT Sloan School of Management

Chi Wan

University of Massachusetts Boston - Department of Accounting and Finance

Date Written: June 2, 2020

Abstract

We use the universe of U.S. job postings to construct a firm-level index that assesses each company’s work from home (WFH) suitability, and study its impact on firms’ resilience during the recent COVID-19 pandemic. Using a difference-in-differences framework, we find strong evidence that, compared to their low-WFH peers, firms with high WFH index values have higher stock returns, lower return volatility, and better financial performance during the pandemic. Our results are robust to stringent empirical specifications that include a variety of fixed effects. Contrary to conventional wisdom, our results hold primarily in non-high-tech industries.

Keywords: Work from Home, Performance, COVID-19

JEL Classification: D24, L23, L84, M11, M54, O31

Suggested Citation

Bai, John (Jianqiu) and Jin, Wang and Steffen, Sebastian and Wan, Chi, The Future of Work: Work from Home Preparedness and Firm Resilience During the COVID-19 Pandemic (June 2, 2020). Available at SSRN: https://ssrn.com/abstract=3616893 or http://dx.doi.org/10.2139/ssrn.3616893

John (Jianqiu) Bai (Contact Author)

Northeastern University - D'Amore-McKim School of Business ( email )

220 B RP
Boston, MA 02115
United States

Wang Jin

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Sebastian Steffen

MIT Sloan School of Management ( email )

100 Main Street
Cambridge, MA 02142
United States

HOME PAGE: http://sebastiansteffen.com/

Chi Wan

University of Massachusetts Boston - Department of Accounting and Finance ( email )

Boston, MA 02125
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
201
Abstract Views
660
rank
166,195
PlumX Metrics