Political Influence, Firm Performance and Survival

Vladimir Sokolov () and Laura Solanko
Additional contact information
Vladimir Sokolov: National Research University Higher School of Economics

HSE Working papers from National Research University Higher School of Economics

Abstract: We examine how regional-level political influence affects firm financial performance and survival. Combining representative survey data on mid-sized manufacturing firms in Russia with official registry data, we find that politically influential firms exhibit higher profitability and retain larger financial investments than non-influential firms. Most importantly, our empirical analysis suggests that the benefits of influence may be transient. Influential firms experienced significantly lower growth during our sample period than non-influential firms. Moreover, influential firms had a significantly higher probability of being liquidated than non-influential firms and the likelihood of the subsequent plant utilization by a new firm was higher for the politically influential liquidated firms.

Keywords: political influence; firm performance; firm liquidation; government quality (search for similar items in EconPapers)
JEL-codes: D22 D72 G33 G38 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2017
New Economics Papers: this item is included in nep-bec, nep-cfn, nep-cis, nep-eff, nep-pol, nep-sbm and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in WP BRP Series: Financial Economics / FE, July 2017, pages - 46

Downloads: (external link)
https://wp.hse.ru/data/2017/07/11/1170894796/60FE2017.pdf (application/pdf)

Related works:
Working Paper: Political influence, firm performance and survival (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hig:wpaper:60/fe/2017

Access Statistics for this paper

More papers in HSE Working papers from National Research University Higher School of Economics
Bibliographic data for series maintained by Shamil Abdulaev () and Shamil Abdulaev ().