Template-type: ReDif-Paper 1.0
Author-Name: Bos, J.W.B.
Author-workplace-name: Finance
Author-Name: Frömmel, M.
Author-Name: Lamers, M.
Author-workplace-name: ICIS
Title: FDI, terrorism and the availability heuristic for U.S. investors before and after 9/11
Abstract: We record the existence of an availability heuristic that is reflected in disaster myopia of U.S. investors and exists prior to the attacks of 9/11. We argue that this is fueled by an aggregate experience hypothesis effect, resulting in a pronounced increase in the sensitivity of U.S. stock prices to terrorist attacks on foreign soil. After 9/11, stock prices react proportionally to the size of an attack and the share of FDI stock held in the region by the sector in which firms operate. This effect, non-existent prior to 2002, has become increasingly strong in recent years.
Series: GSBE Research Memoranda
Creation-Date: 20130101
Number: 047
File-URL: https://cris.maastrichtuniversity.nl/ws/files/838382/guid-7e26b169-b8cd-4496-bbb9-61c09c74a79a-ASSET1.0.pdf
File-Format: application/pdf
File-Size: 814855
Handle: Repec:unm:umagsb:2013047
DOI: 10.26481/umagsb.2013047