Journal article
Religiosity and risk taking: Is there a demand-side effect?
Journal of corporate finance (Amsterdam, Netherlands), Vol.71, p.102117
12/2021
DOI: 10.1016/j.jcorpfin.2021.102117
Abstract
Religiosity may impact firm risk taking via its risk averse employees or through risk-sensitive demand. Using detailed financial statements of property-liability insurance companies, we find that both religiosity at firms' headquarters and the religiosity of firms' largest geographic market are negatively related to firm risk taking. For firms with one salient market, the impact of market religiosity is approximately the same order of magnitude as headquarter religiosity. Our evidence suggests that firm risk taking is influenced by customer demand.
•Average religiosity of consumers influences firm risk taking.•Local religiosity at location of headquarters influences firm risk taking.•Risk sensitivity of insurance demand is more pronounced in high religiosity areas.•Insolvency measure captures asset risk, liability risk and capitalization levels.•Impact of market religiosity is concentrated in firms with a salient market.
Details
- Title: Subtitle
- Religiosity and risk taking: Is there a demand-side effect?
- Creators
- Thomas R. Berry-Stölzle - University of IowaSteven Irlbeck - University of New Hampshire
- Resource Type
- Journal article
- Publication Details
- Journal of corporate finance (Amsterdam, Netherlands), Vol.71, p.102117
- Publisher
- Elsevier B.V
- DOI
- 10.1016/j.jcorpfin.2021.102117
- ISSN
- 0929-1199
- eISSN
- 1872-6313
- Language
- English
- Date published
- 12/2021
- Academic Unit
- Finance
- Record Identifier
- 9984380449202771
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