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2017 ; 12
(5
): e0177720
Nephropedia Template TP
gab.com Text
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English Wikipedia
Traders, guns, and money: The effects of mass shootings on stock prices of
firearm manufacturers in the U S
#MMPMID28542296
Gopal A
; Greenwood BN
PLoS One
2017[]; 12
(5
): e0177720
PMID28542296
show ga
We investigate how mass shootings influence the stock price of firearms
manufacturers. While it is well known that mass shootings lead to increased
firearms sales, the response from financial markets is unclear. On one hand,
given the observed short-term increase in demand, firearm stock prices may rise
due to the unexpected financial windfall for the firm. On the other, mass
shootings may result in calls for regulation of the industry, leading to
divestment of firearms stocks in spite of short-term demand. We examine this
tension using a market movement event study in the wake of 93 mass shootings in
the U.S. between 2009 and 2013. Findings show that stock prices of firearm
manufacturers decline after shootings; each event reducing prices between 22.4
and 49.5 basis points, per day. These losses are exacerbated by the presence of a
handgun and the number of victims killed, but not affected by the presence of
children or location of the event. Finally, we find that these effects are most
prevalent in the period 2009-2010 but disappear in later events, indicating that
markets appear to have accepted mass shootings as the "new normal."