Research Spotlight: Competition, Profitability, and Discount Rates

The fifth installment of Research Spotlight, a Datapoints series focusing on research emerging from Wharton that has employed library resources, highlights a paper co-authored by Wharton Finance faculty member Winston Wei Dou. “Competition, profitability, and discount rates” was published in Journal of Financial Economics 140 (2). 

The paper presents an asset pricing model that includes the impact of fluctuations in discount rates in addition to factors that have been included in existing frameworks, such as dynamic competition strategies. A time series pattern is identified that indicates a comoving pattern between media coverage of price wars and discount rates. The authors used Dow Jones Factiva to collect the media coverage upon which textual analysis was performed. Factiva provides access to a wide variety of news publications, including international, national, regional, and local papers. 

For more information on Factiva, please contact a Lippincott Librarian