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When the market drives you crazy: Stock market returns and fatal car accidents

When the market drives you crazy: Stock market returns and fatal car accidents
When the market drives you crazy: Stock market returns and fatal car accidents
This paper provides evidence that daily fluctuations in the stock market have important–and hitherto neglected–spillover effects on fatal car accidents. Using the universe of fatal car accidents in the United States from 1990 to 2015, we find that a one standard deviation reduction in daily stock market returns is associated with a 0.6% increase in fatal car accidents that happen after the stock market opening. A battery of falsification tests support a causal interpretation of this finding. Our results are consistent with immediate emotions stirred by a negative stock market performance influencing the number of fatal accidents, in particular among inexperienced investors.
Car accidents, Emotions, Stock market
0167-6296
Giulietti, Corrado
c662221c-fad3-4456-bfe3-78f8a5211158
Tonin, Mirco
2929ca00-ca4e-4eb3-bf2b-a5d233b80253
Vlassopoulos, Michael
2d557227-958c-4855-92a8-b74b398f95c7
Giulietti, Corrado
c662221c-fad3-4456-bfe3-78f8a5211158
Tonin, Mirco
2929ca00-ca4e-4eb3-bf2b-a5d233b80253
Vlassopoulos, Michael
2d557227-958c-4855-92a8-b74b398f95c7

Giulietti, Corrado, Tonin, Mirco and Vlassopoulos, Michael (2020) When the market drives you crazy: Stock market returns and fatal car accidents. Journal of Health Economics, 70, [102245]. (doi:10.1016/j.jhealeco.2019.102245).

Record type: Article

Abstract

This paper provides evidence that daily fluctuations in the stock market have important–and hitherto neglected–spillover effects on fatal car accidents. Using the universe of fatal car accidents in the United States from 1990 to 2015, we find that a one standard deviation reduction in daily stock market returns is associated with a 0.6% increase in fatal car accidents that happen after the stock market opening. A battery of falsification tests support a causal interpretation of this finding. Our results are consistent with immediate emotions stirred by a negative stock market performance influencing the number of fatal accidents, in particular among inexperienced investors.

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1-s2.0-S0167629619301237-main - Accepted Manuscript
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Accepted/In Press date: 4 October 2019
e-pub ahead of print date: 20 January 2020
Published date: March 2020
Keywords: Car accidents, Emotions, Stock market

Identifiers

Local EPrints ID: 437616
URI: http://eprints.soton.ac.uk/id/eprint/437616
DOI: doi:10.1016/j.jhealeco.2019.102245
ISSN: 0167-6296
PURE UUID: 3184536f-9c86-4b97-9220-4472b4ea3df1
ORCID for Corrado Giulietti: ORCID iD orcid.org/0000-0003-2986-4438
ORCID for Michael Vlassopoulos: ORCID iD orcid.org/0000-0003-3683-1466

Catalogue record

Date deposited: 06 Feb 2020 17:33
Last modified: 17 Mar 2024 05:15

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Contributors

Author: Corrado Giulietti ORCID iD
Author: Mirco Tonin
Author: Michael Vlassopoulos ORCID iD

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