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In Good Company? COVID-19 Implications for the Digital Transformation of Firms
October 13, 2023 @ 10:30 am - 11:30 am CDT
Part of the Lubar Research Seminar Series
Speaker: Maria Goranova, University of Wisconsin Milwaukee
The COVID-19 pandemic lockdowns ushered companies into a future of digital transformation, irrespective of their level of preparedness for the challenges related to the office-less work. Scholars have pointed that digitalization, data aggregation, and connectivity would erode transaction costs and promote the emergence of self-driving corporations or even render firms obsolete. Using COVID-19 lockdowns as a quasi-natural experiment and studying granularity of foot traffic data, we examine the impact on CEO sentiment. While both CEO sentiment and employees’ online reviews are negatively affected by the COVID-19 mobility restrictions, the effect on CEO sentiment is not driven by local COVID-19 infection rates, business disruptions, or operational uncertainty. It is also robust to an identification test exploiting the implementation of stay-at-home orders across the United States using stacked regression approach.