Price jitters: Do markets punish political stocks?

Saibal Ghosh

MPRA Paper from University Library of Munich, Germany

Abstract: The paper examines the impact of firms exhibiting political connection on their stock market performance. The results appear to suggest that the performance of ‘political’ stocks has been significantly weak. This is apparent in simple univariate tests that compare the political stocks across various industry categories or even comparisons of political versus apolitical stocks. The regression analysis indicates that the returns on political stocks are on average, over 20% lower as compared to stocks without any political association.

Keywords: political connection; buy-and-hold abnormal returns; India (search for similar items in EconPapers)
JEL-codes: G32 P52 (search for similar items in EconPapers)
Date: 2011-06
New Economics Papers: this item is included in nep-cfn and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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