Connected national capital: corporations in colonial and independent Egypt

Cihan Artunç and Mohamed Saleh

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We use a newly assembled dataset covering all Egyptian corporations, their founders, and political officeholders, to demonstrate the differential impact of political connections on firm performance across two distinctive political and economic contexts. Before Egypt’s independence in 1922, political connections reduced firm profitability, as connected firms were perceived to be aligned with the anti-colonial, nationalist movement, unsettling investors. After independence, connections improved firm outcomes by granting preferential access to incorporation and shielding connected companies from competition. These dynamics reflect the shift from a laissez-faire colonial regime to a nationalist industrial policy that selectively favored politically connected firms.

Keywords: political connections; firm dynamics; colonialism; industrial policy (search for similar items in EconPapers)
JEL-codes: F54 G38 N45 (search for similar items in EconPapers)
Date: 2026-03-31
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Published in Journal of Development Economics, 31, March, 2026, 180. ISSN: 0304-3878

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http://eprints.lse.ac.uk/130454/ Open access version. (application/pdf)

Related works:
Working Paper: The Power of Connections: Colonialism, Nationalism, and Corporate Performance in Egypt, 1890 - 1950 (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:130454

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