David Yermack of the New York University Stern School of Business arrived at the W.P. Carey School of Business on Tuesday to speak on the fashion choices of first lady Michelle Obama and her emerging influence on the fashion sector of the stock market.
Yermack presented his paper, “The Michelle Markup: The First Lady’s impact on stock prices of fashion companies,” where he found stock prices of companies whose clothing she wore rose about 1.7 percent in the week following the first lady’s most watched appearances.
Yermack’s findings also show that in 2009, public appearances by Michelle Obama resulted in more than $5 billion in shareholder gains.
Yermack’s paper examines Michelle Obama’s effect on J. Crew stocks after she mentioned in an October 2008 interview with Jay Leno that she was wearing the company’s apparel.
“The effect upon J. Crew Group’s Inc.’s stock price was electric as it rose 8 percent the next day and 25 percent by the end of the week,” Yermack said in his paper.
Michelle Obama’s fashion decisions are part of an effort to close the gap between women of heightened status and the rest of America, Yermack said.
“The influence on the market by the first lady has surprised everyone,” Yermack said. “At the State of the Union address in a few weeks, there will be people keenly interested in what Michelle wears.”
As a recipient of ASU’s Carr and Stephanie Bettis Distinguished Scholar Award, Yermack was invited to the University to address faculty and students at the Department of Finance.
“We were thrilled when we heard Professor Yermack would be coming to speak,” business relations coordinator Jeanne Elliott said. “The subject matter is relevant and intriguing across several categories.”
The presentation drew a mixed audience as staff members interested in the business aspect talked with students engrossed with the fashion.
Finance assistant professor Oliver Boguth, who helped organize the event, enjoyed the change of pace the seminar presented.
“That was certainly one of the most understandable finance seminars I have ever been to,” Boguth said.
Reach the reporter at mjgordo1@asu.edu
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