Senior Honors Projects, 2020-current
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Date of Graduation
5-2021
Publish
yes
Document Type
Thesis
Degree Name
Bachelor of Business Administration (BBA)
Department
Department of Finance and Business Law
Advisor(s)
Pamela P. Drake
Jaideep Chowdhury
Carl Larsson
Abstract
A Black Swan, as termed by Nassim Taleb, is an unexpected, high magnitude event that is often rationalized in hindsight. 9/11 and the Financial Crisis of 2008 are two examples of these tail probability events. Though COVID-19 has been regarded as momentous and unexpected, Taleb does not credit it as a true Black Swan. This paper aims to compare COVID-19 to these recent Black Swans in terms of predictability and significance. Cointegration was tested across 11 major sectors. Further economic indicators were explored with the goal of discussing the broader context of each event. It was concluded that COVID-19 was predictable as compared to the other two events. However, the economic weight of COVID-19 is quite comparable to that of the Financial Crisis of 2008 and should not be ignored.
Recommended Citation
Uehlinger, Ben M., "COVID-19: A Black Swan?" (2021). Senior Honors Projects, 2020-current. 120.
https://commons.lib.jmu.edu/honors202029/120
Included in
Behavioral Economics Commons, Econometrics Commons, Finance Commons
