The Wealth Effects Associated with a Celebrity Endorser: The Michael Jordan Phenomenon

Abstract

On March 9, 1995, rumors began to circulate on Wall Street concerning Michael Jordan’s impending return to the Chicago Bulls. Jordan had previously retired from playing professional basketball in 1993 to play baseball. The results of this study show that anticipation of Jordan’s return to the NBA, and the related increased visibility for him, resulted in an average increase in the market-adjusted values of his client firms of almost 2 percent, or more than $1 billion in stock market value.