Do Campaign Contributions and Lobbying Expenditures by Firms Create “Political” Capital?
We examine the relation between a firm’s campaign contributions and lobbying expenditures and its Tobin’s q. We follow other studies that use q to measure the value of the firm’s intangible capital (e.g., the value of advertising, R&D, or environmental performance). Researchers have found a positive and significant relation between intangible assets and q. If political capital exists, it is an intangible asset. However, we find little relation between q and political contributions, suggesting that campaign contributions may not have long term effects on political markets. This is consistent with the view that contributions are done by firms as a response to a short term opportunity not as a way of building long-term political capital. Copyright International Atlantic Economic Society 2008
Volume (Year): 36 (2008)
Issue (Month): 4 (December)
|Contact details of provider:|| Postal: Suite 650, International Tower, 229 Peachtree Street, N.E., Atlanta, GA 30303|
Phone: (404) 965-1555
Fax: (404) 965-1556
Web page: http://springerlink.metapress.com/link.asp?id=112055
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Davidson, Russell & MacKinnon, James G, 1981.
"Several Tests for Model Specification in the Presence of Alternative Hypotheses,"
Econometric Society, vol. 49(3), pages 781-93, May.
- Russell Davidson & James G. MacKinnon, 1980. "Several Tests for Model Specification in the Presence of Alternative Hypotheses," Working Papers 378, Queen's University, Department of Economics.
- Shameek Konar & Mark A. Cohen, 2001. "Does The Market Value Environmental Performance?," The Review of Economics and Statistics, MIT Press, vol. 83(2), pages 281-289, May.
- Jayachandran, Seema, 2006.
"The Jeffords Effect,"
Journal of Law and Economics,
University of Chicago Press, vol. 49(2), pages 397-425, October.
- Michael J. Cooper & Huseyin Gulen & Alexei V. Ovtchinnikov, 2010. "Corporate Political Contributions and Stock Returns," Journal of Finance, American Finance Association, vol. 65(2), pages 687-724, 04.
- Stephen Ansolabehere & John M. de Figueiredo & James M. Snyder Jr, 2003. "Why is There so Little Money in U.S. Politics?," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 105-130, Winter.
- Thomas Stratmann, 2005. "Some talk: Money in politics. A (partial) review of the literature," Public Choice, Springer, vol. 124(1), pages 135-156, July.
- Hirsch, Barry T & Seaks, Terry G, 1993. "Functional Form in Regression Models of Tobin's q," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 381-85, May.
- Gleason, Katherine I. & Klock, Mark S., 2003. "Intangible capital in the pharmaceutical & chemical industry," Working Papers 2003-04, University of New Orleans, Department of Economics and Finance.
- Brasher Holly & Lowery David, 2006. "The Corporate Context of Lobbying Activity," Business and Politics, De Gruyter, vol. 8(1), pages 1-25, April.
When requesting a correction, please mention this item's handle: RePEc:kap:atlecj:v:36:y:2008:i:4:p:395-405. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.