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on Cultural Economics |
| By: | António Miguel Martins (Faculdade de Economia da Universidade do Porto, Portugal); Ana Paula Serra (CEMPRE, Faculdade de Economia da Universidade do Porto, Portugal) |
| Abstract: | This paper investigates the impact of international sporting and cultural events on national stock markets. We study market reaction to the announcements of the selected country hosting mega-events such as the Olympic Games, the World and the European Football Cups and World Exhibitions. First, we evaluate the abnormal returns of winning bidders at (and around) the announcement date at market and industry-levels. Second, we analyze the determinants of the variation in abnormal returns across events and industries and control for the prior probability of observing the event. Third, on the basis of a simple model of partial anticipation, we reexamine the abnormal returns observed for the winning and losing countries. Our initial results suggest that the abnormal returns are not consistently different from zero. Further, when we look at particular industries, we find no evidence supporting that industries, that a priori were more likely to extract direct benefits from the event, observe positive significant effects. Yet when we control for the prior expectations, the announcement of these megaevents is associated with a positive stock market reaction in the nominated country and a negative reaction in the losing country. Overall we interpret our findings as supportive of rational asset pricing and partial anticipation. |
| Keywords: | Market efficiency; Event studies; Mega-events |
| JEL: | G14 G31 |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:240&r=cul |
| By: | Kern, Holger; Hainmueller, Jens |
| Abstract: | A common claim in the democratization literature is that foreign free media undermine authoritarian rule. No reliable micro-level evidence on this topic exists, however, since independent survey research is rarely possible in authoritarian regimes and self-selection into media consumption complicates causal inferences. In this case study of the impact of West German television on political attitudes in communist East Germany, we address these problems by making use of previously secret survey data and a natural experiment. While most East Germans were able to tune in to West German broadcasts, some of them were cut off from West German television due to East Germany's topography. We exploit this plausibly exogenous variation to estimate the impact of West German television on East Germans' political attitudes using instrumental variable estimators. Contrary to conventional wisdom, East Germans who watched West German television were more satisfied with life in East Germany and the communist regime. To explain this surprising finding, we demonstrate that West German television's role in transmitting political information not available in the state-controlled communist media was insignificant and that television primarily served as a means of entertainment for East Germans. Archival material on the reaction of the East German regime to the availability of West German television corroborates our argument. |
| Keywords: | instrumental variables; causal inference; local average response function; media effects; East Germany; democratization |
| JEL: | F50 D83 O17 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:2702&r=cul |