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The Liquidity Crisis: Evidence from the US Hospitality Industry

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  • Michaël Dewally
  • Yingying Shao
  • Dan Singer

Abstract

This study examines the stock performance of firms in the hospitality industry from 2000 to 2010, focusing on the sector's performance surrounding the liquidity crisis of 2008. In addition, the authors investigate the impact of the liquidity crisis on the firms' capital structure. They find that the sector performed well compared to Standard & Poor's S&P 500 index over the entire period but most notably during expansion sub-periods, and that the restaurant subsector performed better than the casino or hotel sub-sectors during the crisis. They further find that capital-intensive hospitality firms responded to the liquidity crisis by increasing their financial leverage and depleting their cash holdings.

Suggested Citation

  • Michaël Dewally & Yingying Shao & Dan Singer, 2013. "The Liquidity Crisis: Evidence from the US Hospitality Industry," Tourism Economics, , vol. 19(3), pages 545-563, June.
    • Handle: RePEc:sae:toueco:v:19:y:2013:i:3:p:545-563
    DOI: 10.5367/te.2013.0214
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    References listed on IDEAS

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    Cited by:

    1. Michaël Dewally & Susan M.V. Flaherty & Yingying Shao, 2017. "Determinants of financial policy in the hospitality sector in the United States," Tourism Economics, , vol. 23(3), pages 523-542, May.
    2. Mahboubeh Bahreini & Cahit Adaoglu, 2018. "Dividend payouts of travel and leisure companies in Western Europe," Tourism Economics, , vol. 24(7), pages 801-820, November.
    3. Luís Pacheco & Fernando Tavares, 2017. "Capital structure determinants of hospitality sector SMEs," Tourism Economics, , vol. 23(1), pages 113-132, February.
    4. Clark, John & Mauck, Nathan & Pruitt, Stephen W., 2021. "The financial impact of COVID-19: Evidence from an event study of global hospitality firms," Research in International Business and Finance, Elsevier, vol. 58(C).

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