The impacts of the Gulf War on the US defense industry
Author
Cantenar, Ömer Faruk
Advisor
Mugan, Can Şımga
Date
2000Publisher
Bilkent University
Language
English
Type
ThesisItem Usage Stats
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Abstract
In this study, the military intervention of the U.S to the Gulf Crises is taken as
a major event and the impact of this event on the U.S defense stocks is examined by
using event study methodology. The sample includes thirty-nine defense firms
selected from the U.S Department of Defense top contractors list. The analysis of the
abnormal returns on these defense stocks shows that the U.S. military intervention to
the Gulf crises affects these stocks significantly and positively both in the short-term
and in the long-term. The univariate analysis indicates that stock returns of defense
firms are affected differently from this war depending on their defense dependency
and market value. There exists a positive relationship between defense dependency
and abnormal returns of the defense firms, controlling for the size of the firm.