Political Activism and Firm Innovation

Alexei Ovtchinnikov and Syed Reza ()

No 1053, HEC Research Papers Series from HEC Paris

Abstract: Political activism positively affects firm innovation. Firms that support more politicians, politicians on Congressional committees with jurisdictional authority over the firms’ industries and politicians who join those committees innovate more. The authors employ instrumental variables estimation and a natural experiment to show a causal effect of political activism on innovation. The results are consistent with the hypothesis that political activism is valuable because it helps reduce policy uncertainty, which, in turn, fosters firm innovation. Also consistent with this hypothesis, we show that politically active firms successfully time future legislation and set their innovation strategies in expectation of future legislative changes.

Keywords: political contributions; innovation; investment policy; policy uncertainty (search for similar items in EconPapers)
JEL-codes: D72 D80 G31 G38 O31 O38 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2014-07-24
New Economics Papers: this item is included in nep-cdm, nep-cse, nep-ino and nep-pol
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2471058 (application/pdf)

Related works:
Journal Article: Political Activism and Firm Innovation (2020)
Working Paper: Political Activism and Firm Innovation (2014)
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:ebg:heccah:1053

Access Statistics for this paper

More papers in HEC Research Papers Series from HEC Paris HEC Paris, 78351 Jouy-en-Josas cedex, France. Contact information at EDIRC.
Bibliographic data for series maintained by Antoine Haldemann ().