The More Things Change, The More They Stay The Same: Demand-Side Responses to Economic Shocks

40 Pages Posted: 8 Jul 2021

See all articles by Eirik Sjåholm Knudsen

Eirik Sjåholm Knudsen

Norwegian School of Economics (NHH) - Department of Strategy and Management

Lasse B. Lien

Norwegian School of Economics (NHH)

Bram Timmermans

Norwegian School of Economics (NHH); Aalborg University, Department of Business and Management

Robert Wuebker

University of Utah - David Eccles School of Business

Date Written: July 2, 2021

Abstract

When demand drops in an economic crisis, managers rely on an arsenal of demand-side responses to retain existing customers or attract new ones. However, some strategic responses are likely more effective than others. Furthermore, the most effective strategic response likely also depends on firm-specific characteristics that are often elided in theorizing and empirical work. We rely on a survey on strategic responses of Norwegian firms during the Great Recession and investigate demand-side responses of Norwegian CEOs. Findings indeed demonstrate that characteristics like the size of the demand shock and the pre-recession strategy determine demand-side responses during an economic recession.

Keywords: Strategic Response, Demand, Firm-Level Strategy, Recession

JEL Classification: E30, G01, L10

Suggested Citation

Knudsen, Eirik Sjåholm and Lien, Lasse B. and Timmermans, Bram and Wuebker, Robert, The More Things Change, The More They Stay The Same: Demand-Side Responses to Economic Shocks (July 2, 2021). Available at SSRN: https://ssrn.com/abstract=3878905 or http://dx.doi.org/10.2139/ssrn.3878905

Eirik Sjåholm Knudsen

Norwegian School of Economics (NHH) - Department of Strategy and Management ( email )

Breiviksveien 40
N-5045 Bergen
Norway

Lasse B. Lien

Norwegian School of Economics (NHH) ( email )

Helleveien 30
Bergen, 5045
Norway
+47 55959726 (Phone)

Bram Timmermans

Norwegian School of Economics (NHH) ( email )

Helleveien 30
Bergen, NO-5045
Norway

Aalborg University, Department of Business and Management

Fibigerstræde 4
Aalborg, DK-9220
Denmark

Robert Wuebker (Contact Author)

University of Utah - David Eccles School of Business ( email )

1645 East Campus Circle Drive
Salt Lake City, UT 84112-9304
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
8
Abstract Views
87
PlumX Metrics