Big Data and Firm Risk
Name
Paine-painef-SMMR-Management-2022-thesis.pdf
Description
Thesis PDF
Size
4.9 MB
Format
Adobe PDF
Checksum (MD5)
e7a000b5c387738db2dc76fdce44f77a
Author(s)
Paine, Fiona
Advisor(s)
Palmer, Christopher
Date Issued
May 2022
Publisher
Massachusetts Institute of Technology
Abstract
This paper investigates the impact of firm data collection and analysis of collected data on the riskiness of firm cash flows. I use a scraped data set of the third party resources loaded on firms’ websites as a measure of firm data collection and analysis practices. I find that firm use of less effective web analytics is associated with an increase in the variance of sales, inventory, and both fixed and variable costs. This effect is despite a lack of change in the level of these variables. Looking at the effect of treatment on the treated, there is higher profit and sales variance during times of higher uncertainty. I use differences in web analytics technology and a change in their relative effectiveness as my identification strategy. As a case study of a large negative demand shock, I look at differences in firm reactions to COVID-19 based on their web analytics usage.
MIT Department
Sloan School of Management
Terms of Use
In Copyright - Educational Use Permitted
Copyright MIT
Persistent DSpace Link
