The Economic Benefits of Political Connections in Late Victorian Britain
AbstractThe late-Victorian era was characteristed by especially close links between politicians and firms in the UK. Roughly half of all members of Parliament served as company directors, many as directors of multiple firms. We analyze 467 British companies over the period 1895 to 1904 to investigate the interaction of firms and politicians. We find that new-technology firms with politicians serving on their boards were more likely to issue equity finance and had higher Tobin's Q. Our evidence suggests that causality runs from director-politicians to a firm's performance, rather than in the opposite direction.
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Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2011-039.
Date of creation: 2011
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Political Connections; Second Industrial Revolution; External Finance;
Other versions of this item:
- Braggion, Fabio & Moore, Lyndon, 2013. "The Economic Benefits of Political Connections in Late Victorian Britain," The Journal of Economic History, Cambridge University Press, vol. 73(01), pages 142-176, March.
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- N23 - Economic History - - Financial Markets and Institutions - - - Europe: Pre-1913
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-30 (All new papers)
- NEP-HIS-2011-04-30 (Business, Economic & Financial History)
- NEP-POL-2011-04-30 (Positive Political Economics)
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