Title

THE IMPACT OF THE GREAT RECESSION ON S&P 500 FIRMS AND THEIR MARKETING EFFORTS: AN EMPIRICAL ANALYSIS

Document Type

Article

Publication Date

2016

Keywords

The Great Recession, impact, S&P firms, marketing efforts

Disciplines

Accounting | Marketing

Abstract

The deep financial crisis during 2007-2009 evoked memories of the Great Depression and caused a steep decline in stock prices in the U.S. and around the world. The accompanying job losses of this Great Recession led to forceful responses from the government. This study investigates the responses of large US firms (namely S&P 500) to this recession by analyzing their financial statements. This study investigates the following research questions: Were there any differences in intangible assets and Tobin’s q between pre and post crisis periods? Did the cash flows improve significantly in the post crisis period? Did the advertising expenditures spike significantly? Did the capital expenditures increase significantly in the post crisis period? The Logit results of this study suggest that auditor opinion (a governance proxy), intangible assets to total assets ratio (brand equity), cash flow to sales ratio, capital intensity, and Tobin’s q (growth proxy) are significantly different between pre and post crisis periods.

Publication Title

International Journal of Business and Economic Perspectives

Volume

11

Issue

1

First Page

51

Last Page

64

ISSN

1931-907X

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