Broadcasts of Insurance Institute for Highway Safety high-speed automotive crash tests on NBC's Dateline do not affect either market shares or stock prices. However, injury claims within a market class are highly correlated with crash test ratings. Inattention to the tests may be a consequence of the manner in which the crash tests have been presented and because the crashworthiness of the U.S. vehicle fleet is positively correlated with consumer estimates of expected vehicle safety.
Get full access to this article
View all access options for this article.
References
1.
BrownStephen, and WarnerJerald (1985), “Using Daily Stock Returns: The Case of Event Studies,”Journal of Financial Economics, 14 (January), 3–31.
2.
CraftonSteven M., HofferGeorge E., and ReillyRobert J. (1981), “Testing the Impact of Recalls on Automobile Demand,”Economic Inquiry, 19 (October), 694–703.
3.
CrandallRobert W., and GrahamJohn D. (1989), “The Effect of Fuel Economy Standards on Automobile Safety,”Journal of Law and Economics, 32 (January), 97–119.
4.
CrandallRobert W., KeelerTheodore E., and LaveLester B. (1982), “The Cost of Automobile Safety and Emissions Regulation to the Consumer: Some Preliminary Results,”American Economic Review, 72 (May), 324–27.
5.
FarmerCharles M. (2004), Relationships of Frontal Offset Crash Test Results to Real-World Driver Fatality Rates.Arlington, VA: Insurance Institute For Highway Safety.
6.
HarlessDavid W., and HofferGeorge E. (2003), “Testing for Offsetting Behavior and Adverse Recruitment Among Drivers of Airbag-Equipped Vehicles,”The Journal of Risk and Insurance, 70 (4), 629–50.
7.
Highway Loss Data Institute (1996–2002), Injury, Collision and Theft Losses.Arlington, VA: Highway Loss Data Institute.
8.
HofferGeorge E., PruittStephen W., and ReillyRobert J. (1987), “Automotive Recalls and Informational Efficiency,”The Financial Review, 22 (February), 433–42.
9.
HofferGeorge E., PruittStephen W., and ReillyRobert J. (1988), “The Impact of Product Recalls on the Wealth of Sellers: A Reexamination,”Journal of Political Economy, 96 (June), 663–70.
10.
HofferGeorge E., PruittStephen W., and ReillyRobert J. (1992), “Market Responses to Publicly-Provided Information: The Case of Automotive Safety,”Applied Economics, 24 (July), 661–67.
11.
HofferGeorge E., PruittStephen W., and ReillyRobert J. (1994), “When Recalls Matter: Factors Affecting Owner Response to Automotive Recalls,”Journal of Consumer Affairs, 28 (Summer), 96–106.
12.
Insurance Institute for Highway Safety (2002), “NBC News Transcripts,” (accessed November 19, 2003), [available at http://www.lexus-nexis.com].
13.
Insurance Institute for Highway Safety (2004), “How the Institute Evaluates Vehicles in the Frontal Offset Crash Test,” (accessed August 4, 2004), [available at http://www.iihs.org/vehicle_ratings/ce/def.htm].
14.
JarrellGregg, and PeltzmanSam (1985), “The Impact of Product Recalls of the Wealth of Sellers,”Journal of Political Economy, 93 (June), 512–36.
15.
LaveLester B., and WeberWarren E. (1970), “A Benefit–Cost Analysis of Auto Safety Features,”Applied Economics, 2, 265–75.
16.
PeltzmanSam (1975), “The Effects of Automobile Safety Regulation,”Journal of Political Economy, 83 (August), 677–725.
17.
PetersonSteven P., and HofferGeorge E. (1994), “The Impact of Airbag Adoption on Relative Personal Injury and Absolute Collision Insurance Claims,”Journal of Consumer Research, 20 (March), 661–67.
18.
PruittStephen W., and PetersonDavid R. (1986), “Security Market Reactions to Around Product Recall Announcements,”Journal of Financial Research, 9 (Summer), 113–22.
19.
PruittStephen W., ReillyRobert J., and HofferGeorge E. (1986), “Security Market Anticipation of Consumer Preference Shifts: The Case of Automotive Recalls,”Quarterly Journal of Business and Economics, 25 (Autumn), 14–28.
20.
ReillyRobert J., and HofferGeorge E. (1983), “Will Retarding the Information Flow on Automobile Recalls Affect Consumer Demand?”Economic Inquiry, 21 (July), 444–47.
21.
RuppNicholas (2001), “Are Government Initiated Recalls More Damaging to Stockholders? Evidence from Automobile Recalls, 1973-98,”Economic Letters, 71 (May), 265–70.
22.
RuppNicholas, and TaylorCurtis G. (2002), “Who Initiates Recalls and Who Cares? Evidence from the Automobile Industry,”Journal of Industrial Economics, 50 (June), 123–29.
23.
U.S. Department of Transportation (2003), “New Car Assessment Program,”National Highway Traffic and Safety Administration, (accessed 2003), [available at www.nhtsa.gov/ncap].
