IDEAS home Printed from https://ideas.repec.org/a/wsi/rpbfmp/v23y2020i02ns0219091520500137.html
   My bibliography  Save this article

Wealth Effects of Retail Store Closure Announcements

Author

Listed:
  • Abdul-Rahman Khokhar

    (Sobey School of Business, Saint Mary’s University, Halifax, Canada)

Abstract

This is the first study, to the best of our knowledge, to use value- and equal-weighted portfolios of U.S. retail firms to examine the stock market reaction to strategic and nonliquidating store closure announcements. Using event study methodology for a sample of 174 hand-collected store closure announcements during the period 1980–2017, we find a negative and significant stock price reaction on the announcement date. Given the highly competitive nature of the retail industry, we further investigate the market reaction for the closest competitors using a matched sample of 157 competing firms. We report a positive, albeit less significant stock price reaction for competing retail firms on the announcement date. Finally, a cross-sectional analysis shows that the stock price reaction to store closure announcements is positively associated with firm size.

Suggested Citation

  • Abdul-Rahman Khokhar, 2020. "Wealth Effects of Retail Store Closure Announcements," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 23(02), pages 1-27, June.
    • Handle: RePEc:wsi:rpbfmp:v:23:y:2020:i:02:n:s0219091520500137
    DOI: 10.1142/S0219091520500137
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S0219091520500137
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1142/S0219091520500137?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wsi:rpbfmp:v:23:y:2020:i:02:n:s0219091520500137. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/rpbfmp/rpbfmp.shtml .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.