Publication:
Political Connections and Preferential Access to Finance: The Role of Campaign Contributions

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dc.contributor.authorClaessens, Stijn
dc.contributor.authorFeijen, Erik
dc.contributor.authorLaeven, Luc
dc.date.accessioned2012-03-30T07:33:17Z
dc.date.available2012-03-30T07:33:17Z
dc.date.issued2008
dc.description.abstractUsing novel indicators of political connections constructed from campaign contribution data, we show that Brazilian firms that provided contributions to (elected) federal deputies experienced higher stock returns than firms that did not around the 1998 and 2002 elections. This suggests that contributions help shape policy on a firm-specific basis. Using a firm fixed effects framework to mitigate the risk that unobserved firm characteristics distort the results, we find that contributing firms substantially increased their bank financing relative to a control group after each election, indicating that access to bank finance is an important channel through which political connections operate. We estimate the economic costs of this rent seeking over the two election cycles to be at least 0.2% of gross domestic product per annum.en
dc.identifier.citationJournal of Financial Economics
dc.identifier.issn0304405X
dc.identifier.urihttps://hdl.handle.net/10986/5530
dc.language.isoEN
dc.relation.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.rights.holderWorld Bank
dc.subjectModels of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior D720
dc.subjectInformation and Market Efficiency
dc.subjectEvent Studies G140
dc.subjectEconomic Development: Financial Markets
dc.subjectSaving and Capital Investment
dc.subjectCorporate Finance and Governance O160
dc.subjectFormal and Informal Sectors
dc.subjectShadow Economy
dc.subjectInstitutional Arrangements O170
dc.titlePolitical Connections and Preferential Access to Finance: The Role of Campaign Contributionsen
dc.title.alternativeJournal of Financial Economicsen
dc.typeJournal Articleen
dc.typeArticle de journalfr
dc.typeArtículo de revistaes
dspace.entity.typePublication
okr.doctypeJournal Article
okr.externalcontentExternal Content
okr.identifier.externaldocumentum427
okr.journal.nbpages554-580
okr.language.supporteden
okr.peerreviewAcademic Peer Review
okr.region.countryBrazil
okr.relation.associatedurlhttp://dx.doi.org/10.1016/j.jfineco.2006.11.003
okr.relation.associatedurlhttp://search.ebscohost.com/login.aspx?direct=true&db=eoh&AN=0993239&site=ehost-live
okr.relation.associatedurlhttp://www.elsevier.com/wps/find/journaldescription.cws_home/505576/description#description
okr.volume88
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