The Effect of Weather Management on Firm Performance by Using Propensity Score Matching

Existing research has emphasized the importance of weather factors in business by analyzing the effects of weather changes on firm performance. However, this study is different from previous researches in that it analyzes the difference in business performance according to degree of utilization of meteorological information in management strategy. In 2010‐2017, we constructed a dataset combining an external audit companyʹs financial statements with information on companies with excellent weather management and used propensity score matching (PSM) to estimate the net effect of weather management while controlling sample selection bias. We confirmed that a company with excellent weather management has 9.6 ~ 19.9% higher sales growth rate, 2.0 ~ 8.7% lower operating cost per sale, and 11 ~ 88 million won higher operating income per employee. These results suggest that active use of weather information in management activities plays a positive role in business performance.