Geographic dispersion and corporate resilience during the COVID-19 pandemic

Fei Jiang; Dongmin Kong; Zhengfei Lu; Yongqiang Ma; Yang Yi

doi:10.1016/j.irfa.2023.102684

Geographic dispersion and corporate resilience during the COVID-19 pandemic

Int Rev Financ Anal. 2023 Jul:88:102684. doi: 10.1016/j.irfa.2023.102684. Epub 2023 May 12.

Authors

Fei Jiang¹, Dongmin Kong², Zhengfei Lu¹, Yongqiang Ma³, Yang Yi³

Affiliations

¹ Guanghua School of Management, Peking University, 5 Yiheyuan Road, Haidian, Beijing, PR China.
² School of Economics, Huazhong University of Science and Technology, 1037 Luoyu Road, Hongshan, Wuhan, Hubei, PR China.
³ School of Accounting, Southwestern University of Finance and Economics, 555 Liutai Avenue, Wenjiang, Chengdu, Sichuan, PR China.

Abstract

This study demonstrates the positive role of geographic dispersion in corporate resilience to the COVID-19 pandemic in the context of China. This association is more pronounced when firms are highly dependent on the domestic market, less likely to obtain enough financing, highly apply digital technology, and have low customer concentration. This association is attributable to the following three channels: a diversified portfolio, the maintenance of business relationships, and access to non-local resources. Overall, our findings provide a more nuanced picture of the potential impacts of corporate diversification on corporate resilience.

Keywords: COVID-19 pandemic; Corporate resilience; Firm value; Geographic dispersion.