Journal of the Korean Data and Information Science Society

The Korean Data and Information Science Society (한국데이터정보과학회)
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The effect of health care reform: Testing the stability of systematic risk

  • Sewell, Daniel K. (Department of Mathematical Sciences, University of Arkansas) ;
  • Song, Joon-Jin (Center for Statistical Research and Consulting & Department of Mathematical Sciences, University of Arkansas)
  • Received : 2010.06.30
  • Accepted : 2010.08.25
  • Published : 2010.09.30
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Abstract

As the U.S. Congress has continued to debate over the health care reform pushed by President Obama, there is an ample reason to believe that the systematic risk of the health care industry, especially health care plan providers, is increasing. This study measures and compares the systematic risk of two health care industry indexes and one portfolio of health care plan providers from before and after the introduction of the health care legislation into Congress in September, 2009. The Capital Asset Pricing Model (CAPM) is used to measure the systematic risk, and a dummy variable approach and the Chow test are used to formally compare the systematic risk from before and after the introduction of the legislation.

Keywords

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