Advertisement

Atlantic Economic Journal

, Volume 41, Issue 4, pp 461–462 | Cite as

Stocks on the Rocks: A Costa Concordia Sinking Event Study

  • Joanna L. Howard
  • E. Frank StephensonEmail author
Anthology

On 13 January 2012, the cruise ship Costa Concordia sank off the coast of Italy, killing 32 people. Similar to previous studies examining the effects of events such as the Valujet flight 592 crash and the space shuttle Challenger explosion, we analyze whether the Costa Concordia sinking adversely affected the stock price of the ship’s operator, Carnival Cruise Lines. The Costa Concordia event should directly affect Carnival because it caused the loss of one of its ships (approximately 1.5 % of its capacity) and because the company may face fines, civil actions from passengers or their survivors, large costs associated with removing the ship, and/or a loss of future cruise bookings because of safety fears.

We also consider the effect of the Costa Concordiasinking on other cruise lines. On one hand, other cruise providers might also experience an adverse effect because the sinking might reduce the demand for cruises across all cruise operators. On the other hand, other cruise companies...

JEL

G14 

Copyright information

© International Atlantic Economic Society 2013

Authors and Affiliations

  1. 1.Campbell School of BusinessBerry CollegeMount BerryUSA
  2. 2.Department of EconomicsBerry CollegeMount BerryUSA

Personalised recommendations