Corporate Influence and Political Corruption: Lessons from Stock Market Reactions to Political Events

Jeffrey Milyo

No 1323, Working Papers from Department of Economics, University of Missouri

Abstract: Stock market reactions to political events demonstrate that the value of some firms is strongly affected by which party controls political power. However, contrary to common perception, event studies do not indicate that the ability to make unlimited political contributions or expenditures enhances a firm's value. Instead, geographic and personal connections to political actors matter more for firms' bottom line, although there is some evidence that personal connections may be rented via professional lobbying.

Keywords: Campaign Contributions; Corruption; Event Studies; Lobbying (search for similar items in EconPapers)
JEL-codes: D7 H0 K0 L2 (search for similar items in EconPapers)
Pages: 28 pgs.
Date: 2013-12-30
New Economics Papers: this item is included in nep-bec, nep-law and nep-pol
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:umc:wpaper:1323

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