International oligopoly and stock market linkages : the case of global airlines

Stephen X. H. GONG, Michael Arthur FIRTH, Kevin CULLINANE

Research output: Journal PublicationsJournal Article (refereed)

2 Citations (Scopus)

Abstract

This paper investigates the effect of oligopolistic rivalry on spillovers in financial reporting. Using an event study methodology and focusing on global airlines, we find that firms experience discernable abnormal stock price reactions at the announcement of unexpected earnings by rival airlines. The extent of the price reactions is related to the extent of rivalry between the announcing and non-announcing firms, among other factors. Our empirical evidence, which is inconsistent with the contestable markets hypothesis, confirms an association between the stock market performance of players in a global industry and the extent of inter-firm rivalry in the product market.
Original languageEnglish
Pages (from-to)621-636
Number of pages16
JournalTransportation Research Part E: Logistics and Transportation Review
Volume44
Issue number4
DOIs
Publication statusPublished - 1 Jul 2008

Fingerprint

International oligopoly
Stock market
Linkage
Airlines
Rivalry
Factors
Product market
Contestable markets
Spillover
Empirical evidence
Announcement
Stock market performance
Industry
Price reaction
Financial reporting
Stock price reaction
Event study methodology

Bibliographical note

Paper presented at the 10th Annual Conference of the Air-Transport-Research-Society, May, 2006, Nagoya, Japan.

Keywords

  • Information transfer; Airlines; Earnings; Oligopoly; Stock market performance; Event study methodology

Cite this

GONG, Stephen X. H. ; FIRTH, Michael Arthur ; CULLINANE, Kevin. / International oligopoly and stock market linkages : the case of global airlines. In: Transportation Research Part E: Logistics and Transportation Review. 2008 ; Vol. 44, No. 4. pp. 621-636.
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International oligopoly and stock market linkages : the case of global airlines. / GONG, Stephen X. H.; FIRTH, Michael Arthur; CULLINANE, Kevin.

In: Transportation Research Part E: Logistics and Transportation Review, Vol. 44, No. 4, 01.07.2008, p. 621-636.

Research output: Journal PublicationsJournal Article (refereed)

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