The Tiger Woods scandal cost the shareholders of companies he endorsed between $5 billion and $12 billion dollars, according to a study by two University of California economics professors.
According to a Reuters story, the professors, from UC Davis, wrote in their report that they "looked at stock market returns for the 13 trading days after November 27, the date of the car incident that ignited the Woods scandal. They compared returns for Woods’ sponsors during this period to those of both the total stock market and of each sponsor’s closest competitor. They also reviewed returns for four years before the car accident to build up a comparative picture of the sponsors’ market performance."
In addition, the Reuters story said that the economics professors "called the results statistically significant and said the overall pattern of losses at the parent companies was unlikely to stem from ordinary day-to-day variation in their stock prices."
The professors also said that "Our findings speak to a larger question of general interest in the business and academic communities: Does celebrity sponsorship have any impact on a firm’s bottom line?"
To read the actual study as published by the University of California professors, click here.