Economic policy uncertainty and corporate investment: Evidence from the U.S. hospitality industry

Sagi Akron; Ender Demir; José María Díez-Esteban; Conrado Diego García-Gómez

doi:10.1016/j.tourman.2019.104019

Economic policy uncertainty and corporate investment: Evidence from the U.S. hospitality industry

Sagi Akron, Ender Demir, José María Díez-Esteban, Conrado Diego García-Gómez

School Of Business Administration

Research output: Contribution to journal › Article › peer-review

Abstract

The study of how uncertainty affects hospitality firms’ decisions is gaining attention in recent years. We examine the effect of Economic Policy Uncertainty (EPU) on the investment policy of a sample of 305 hospitality companies in the U.S. for the period 2001–2018. Applying generalized methods of moments (GMM) technique, we find that investment policies in hospitality companies are negatively affected by EPU. Panel quantile estimations reveal that the effect of EPU on corporate investment is only relevant for companies in the lower quantile of capital expenditures ratio. Our paper also provides policy implications to related parties.

Original language	English
Article number	104019
Journal	Tourism Management
Volume	77
DOIs	https://doi.org/10.1016/j.tourman.2019.104019
State	Published - Apr 2020

Bibliographical note

Funding Information:
This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P . All the remaining errors are our responsibility.

Funding Information:
This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P. All the remaining errors are our responsibility.

Publisher Copyright:
© 2019 Elsevier Ltd

Keywords

Economic policy uncertainty
Hospitality
Investment
Panel quantile
U.S.

ASJC Scopus subject areas

Development
Transportation
Tourism, Leisure and Hospitality Management
Strategy and Management

Access to Document

10.1016/j.tourman.2019.104019

Cite this

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abstract = "The study of how uncertainty affects hospitality firms{\textquoteright} decisions is gaining attention in recent years. We examine the effect of Economic Policy Uncertainty (EPU) on the investment policy of a sample of 305 hospitality companies in the U.S. for the period 2001–2018. Applying generalized methods of moments (GMM) technique, we find that investment policies in hospitality companies are negatively affected by EPU. Panel quantile estimations reveal that the effect of EPU on corporate investment is only relevant for companies in the lower quantile of capital expenditures ratio. Our paper also provides policy implications to related parties.",

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note = "Funding Information: This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P . All the remaining errors are our responsibility. Funding Information: This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P. All the remaining errors are our responsibility. Publisher Copyright: {\textcopyright} 2019 Elsevier Ltd",

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N1 - Funding Information: This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P . All the remaining errors are our responsibility. Funding Information: This research has been financed by Spanish Public Funds through Ministry of Economy and Competitiveness in the framework of the project ECO2017-84864-P. All the remaining errors are our responsibility. Publisher Copyright: © 2019 Elsevier Ltd

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AB - The study of how uncertainty affects hospitality firms’ decisions is gaining attention in recent years. We examine the effect of Economic Policy Uncertainty (EPU) on the investment policy of a sample of 305 hospitality companies in the U.S. for the period 2001–2018. Applying generalized methods of moments (GMM) technique, we find that investment policies in hospitality companies are negatively affected by EPU. Panel quantile estimations reveal that the effect of EPU on corporate investment is only relevant for companies in the lower quantile of capital expenditures ratio. Our paper also provides policy implications to related parties.

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Economic policy uncertainty and corporate investment: Evidence from the U.S. hospitality industry

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

Access to Document

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