Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

MEASURING THE COST OF ENVIRONMENTAL AND LABOR PROTESTS TO GLOBALIZATION: An Event Study of the Failed 1999 Seattle WTO Talks

MEASURING THE COST OF ENVIRONMENTAL AND LABOR PROTESTS TO GLOBALIZATION: An Event Study of the... The World Trade Organization's ministers failed to set an agenda for the Millennial Round of trade negotiations during their 1999 Seattle meeting, the first time such a meeting failed since multilateral trade agreements first began in 1947. Additionally, the Seattle meeting encountered unprecedented public protests against the WTO and trade liberalization, and globalization more broadly. How serious were the protests and the failure to commence a new trade round in Seattle? Utilizing an event study, we find that investors bid down the stock price of a portfolio of Fortune 500 firms almost two percent. Moreover, the cost to firms in industries perceived as environmentally or labor-abusive (the specific protest targets) was higher. A sub-sample of firms in "abusive" industries experienced negative returns of 2.7 percent, which was almost twice the decline for the remaining firms in "non-abusive" industries. Regression analysis shows that returns were driven primarily by a firm's inclusion in an abusive industry, rather than by its level of internationalization. Additionally, when the component halves of the abusive sample are analyzed separately, only firms in environmentally abusive industries experienced a statistically significant negative stock decline. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The International Trade Journal Taylor & Francis

MEASURING THE COST OF ENVIRONMENTAL AND LABOR PROTESTS TO GLOBALIZATION: An Event Study of the Failed 1999 Seattle WTO Talks

32 pages

Loading next page...
 
/lp/taylor-francis/measuring-the-cost-of-environmental-and-labor-protests-to-vWdkWUTq0B

References (28)

Publisher
Taylor & Francis
Copyright
Copyright Taylor & Francis Group, LLC
ISSN
1521-0545
eISSN
0885-3908
DOI
10.1080/08853900252901396
Publisher site
See Article on Publisher Site

Abstract

The World Trade Organization's ministers failed to set an agenda for the Millennial Round of trade negotiations during their 1999 Seattle meeting, the first time such a meeting failed since multilateral trade agreements first began in 1947. Additionally, the Seattle meeting encountered unprecedented public protests against the WTO and trade liberalization, and globalization more broadly. How serious were the protests and the failure to commence a new trade round in Seattle? Utilizing an event study, we find that investors bid down the stock price of a portfolio of Fortune 500 firms almost two percent. Moreover, the cost to firms in industries perceived as environmentally or labor-abusive (the specific protest targets) was higher. A sub-sample of firms in "abusive" industries experienced negative returns of 2.7 percent, which was almost twice the decline for the remaining firms in "non-abusive" industries. Regression analysis shows that returns were driven primarily by a firm's inclusion in an abusive industry, rather than by its level of internationalization. Additionally, when the component halves of the abusive sample are analyzed separately, only firms in environmentally abusive industries experienced a statistically significant negative stock decline.

Journal

The International Trade JournalTaylor & Francis

Published: May 1, 2002

There are no references for this article.