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Corporate Lobbying and Financial Performance

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  • Chen, Hui
  • Parsley, David
  • Yang, Ya-wen

Abstract

Corporate lobbying activities are designed to influence legislators and thus to further company goals by encouraging favorable policies and/or outcomes. Using data made available by the Lobbying Disclosure Act of 1995, this study examines corporate lobbying activities from a financial perspective. We find that on average, lobbying is positively related to accounting and market measures of financial performance. These results are robust across a number of empirical specifications and continue to hold when we account for potential sample selection. We also report market performance evidence using a portfolio approach. We find that portfolios of firms with the highest lobbying intensities significantly outperform their benchmarks in the three years following portfolio formation.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 21114.

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Date of creation: Jan 2010
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Handle: RePEc:pra:mprapa:21114

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Keywords: Corporate Lobbying; accounting performance; market returns; portfolio;

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Citations

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Cited by:
  1. Ludema, Rodney D & Mayda, Anna Maria & Mishra, Prachi, 2010. "Protection for Free? The Political Economy of U.S. Tariff Suspensions," CEPR Discussion Papers 7926, C.E.P.R. Discussion Papers.
  2. Islam, Asif & López, Ramón, 2011. "Fiscal spending for economic growth in the presence of imperfect markets," CEPR Discussion Papers 8709, C.E.P.R. Discussion Papers.
  3. William R. Kerr & William F. Lincoln & Prachi Mishra, 2011. "The Dynamics of Firm Lobbying," NBER Working Papers 17577, National Bureau of Economic Research, Inc.
  4. Kammerer, Hannes, 2013. "Lobbying for Subsidies with Heterogeneous Firms," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79767, Verein für Socialpolitik / German Economic Association.

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