Browsing by Subject "Contagion"
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Item Open Access Contagion of network products in small-world networks(Springer, 2019-05-20) İkizler, HüseyinWe formulate a model in which agents embedded in an exogenous social network decide whether to adopt a new network product or not. In the theoretical part of the paper, we characterize the stochastically stable equilibria for complete networks and cycles. For an arbitrary network structure, we develop a novel graph decomposition method to characterize the set of recurrent communication states, which is a superset of stochastically stable equilibria of the adoption game presented in our model. In the simulation part, we study the contagion process of a network product in small-world networks that systematically represent social networks. We simulate a generalization of the Morris (Rev Econ Stud 67(1):57–78, 2000) Contagion model that can explain the chasm between early adopters and early majority. Our numerical analysis shows that the failure of a new network product is less likely in a highly cliquish network. In addition, the contagion process reaches to steady state faster in random networks than in highly cliquish networks. It turns out that marketers should work with mixed marketing strategies, which will result in a full contagion of a network product and faster contagion rates with a higher probability.Item Open Access The financial market effects of international aviation disasters(Elsevier, 2020) Akyıldırım, E.; Corbet, S.; Efthymiou, M.; Guiomard, C.; O'Connell, J. F.; Şensoy, AhmetThe spread of misinformation with regards to aviation disasters continues to be a point of concern for aviation companies. Much of this information usually surrounds speculation based on the cause and responsibility attributed to the incident, implicitly possessing the potential to generate significant financial market price volatility. In this paper, we investigate a number of stylised facts relating to the effects of airline disasters on aviation stocks, while considering contagion effects, information flows and the sources of price discovery within the broad sector. Results indicate a substantially elevated levels of share price volatility in the aftermath of aviation disasters, while cumulative abnormal returns present sharp under-performance of the analysed companies relative to international exchanges. When considering an EGARCH analysis, we observe that share price volatility appears to be significantly influenced by the scale of the disaster in terms of the fatalities generated. Significant contagion effects upon the broad aviation index along with substantial changes in traditional price discovery channels are also identified. The role that the spread of information on social media, whether it be correct or of malicious origins, cannot be eliminated as an explanatory factor of these changing dynamics over time and region.Item Open Access The influence of aviation disasters on engine manufacturers: An analysis of financial and reputational contagion risks(Elsevier BV, 2021-03) Akyıldırım, E.; Corbet, S.; O'Connell, J. F.; Şensoy, AhmetOne of the key sub-sectors in the aviation industry includes that of engine manufacturers, who have long led technological advancement and the battle to reduce airline carbon emissions. However, these same companies have been susceptible to a number of issues that have been central to international airlines due to higher costs and competition pressures. When an aviation disaster occurs, there is widespread allocation of blame and responsibility, which has left engine manufacturers exposed until the true cause is identified. This can generate many issues with regards to reputational damage and ability to generate finance. We set out to analyse such interactions over time and region. Our results indicate that engine manufacturers have had to contend with substantial income and financial leverage issues in the aftermath of a major aviation disaster, irrespective of whether they have been identified as a causation factor in the incident itself. Further, we clearly identify that there exists an average one day loss of 1.64% in the immediate aftermath of aviation incidents. Substantial corporate instability is found to persist without the company being in any way responsible for the incident. Shortly thereafter, contagion effects increase as speculation diminishes and more factual evidence arrives. The role of social media is examined as a potential contributory factor.