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Presidential elections and secretary appointment: an event study for us biotechnology and drugs
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Orientador(es)
Resumo(s)
The aim of this study is to analyse the effect of the 2024 US presidential election and the
appointment of the US health secretary to the largest US listed biotechnology and drug firms.
Using an event study methodology, we find that President Donald Trump’s election had no sig nificant impact on the industry. On the contrary, the results show statistically significant negative
stock price reactions around the US health secretary appointment. The negative industry reaction
to the US health secretary appointment is largely explained by his scepticism about vaccination
and criticism about the high prices of drug prescriptions and margins in the industry. These re sults highlight the importance of top government position appointments, especially when such
appointments eliminate much of the uncertainty regarding future government action in the in dustry and political uncertainty hypothesis. Finally, cross-section analysis reveals that the firms
most penalized by the 2024 US presidential election and the appointment of the US health sec retary are those with the highest investments in R&D and capital expenditures. This could mean
lower future investments in new vaccines or drugs, seriously harming society.
Descrição
Palavras-chave
Stock returns US presidential elections Biotechnology and drugs Event study . Faculdade de Ciências Sociais
Contexto Educativo
Citação
Editora
Elsevier