Stock ownership and political behavior: Evidence from demutualization

Markku Kaustia, Samuli Knüpfer and Sami Torstila

No 2, SAFE Working Paper Series from Leibniz Institute for Financial Research SAFE

Abstract: A setting in which customer-owned mutual companies converted to publicly listed firms created a plausibly exogenous shock to salience of stock ownership. We use this shock to identify the effect of stock ownership on political behavior. Using IV regressions, difference-in-differences analyses, and matching methods, we find the shock changed the way people vote in the affected areas, with the demutualizations being followed by a 1.7–2.7 percentage points increase in rightof- center vote share. Analyses of demutualizations that did not involve public listing of shares suggest that explanations based on wealth, liquidity, and tax-related incentives do not drive the results.

Keywords: Stock market participation; political behavior; salience; attention (search for similar items in EconPapers)
JEL-codes: D72 G11 P16 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Stock Ownership and Political Behavior: Evidence from Demutualizations (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:safewp:2

DOI: 10.2139/ssrn.2209645

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