LAUSR

Abstract A strategic emphasis on value appropriation to value creation framework has emerged as a growing area of research. However, whether such emphasis is effective in periods of different market trends remains an unexplored area of research. Among 287 firms in 17 industries listed on the New York Stock Exchange between 1980 and 2010, the authors found that strategic emphasis on advertising significantly decreases a firm's systematic risk when the stock market is experiencing a downturn (i.e., shielding stock returns in market downturns). Similarly, strategic emphasis on advertising significantly increases a firm's systematic risk when the market moves upwards (i.e., stimulating stock returns during market upturns). These results highlight that a strategic emphasis on value appropriation to value creation helps investor confidence recover during dark times and boosts it during good ones.