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Beyond Political Connections: A Measurement Model Approach to Estimating Firm-level Political Influence in 41 Economies

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dc.contributor.authorFrancis, David C.
dc.contributor.authorKubinec, Robert
dc.date.accessioned2022-07-06T17:22:40Z
dc.date.available2022-07-06T17:22:40Z
dc.date.issued2022-07
dc.description.abstractThis paper considers the political influence of private firms. While such influence is frequently discussed, there is limited analysis of how firms combine political interactions, and under what conditions, to gain influence. The exception is the large literature on firms with political connections, with findings generally showing large gains to firms with those direct relationships. This paper extends the discussion of influence beyond political connections alone and uses a rich firm-level data set from 41 economies, which includes information on several interactions with political actors. Using a Bayesian item response theory (IRT) measurement model, an index of Political Influence is estimated, with the prior assumption that political connections yield more influence. Membership in a business association is found to enhance influence, while such influence is offset by bribes, state ownership, firm size, and a reliance on collective lobbying. Political Influence is found to be broadly higher in economies with poorer governance but more dispersed in those with better governance. Within economies, higher influence is associated with a higher likelihood of reporting a small number of competitors, higher sales, and lower labor inputs relative to sales. These findings are robust across several models that incorporate high-dimensional fixed effects, incorporating measurement error in the index, and varying these relationships over several governance measures.en
dc.identifierhttp://documents.worldbank.org/curated/en/099855207052233298/IDU0158ecaac01be104fd80a04a03c9cf1992a74
dc.identifier.doi10.1596/1813-9450-10119
dc.identifier.urihttps://hdl.handle.net/10986/37646
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC : World Bank
dc.relation.ispartofseriesPolicy Research Working Paper;10119
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectPOLITICAL INFLUENCE
dc.subjectPOLITICAL CONNECTIONS
dc.subjectPRIVATE FIRMS
dc.subjectBAYESIAN
dc.subjectLATENT VARIABLES
dc.titleBeyond Political Connectionsen
dc.title.subtitleA Measurement Model Approach to Estimating Firm-level Political Influence in 41 Economiesen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.date.disclosure2022-07-05
okr.date.lastmodified2022-07-05T00:00:00Zen
okr.doctypePublications & Research
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://documents.worldbank.org/curated/en/099855207052233298/IDU0158ecaac01be104fd80a04a03c9cf1992a74
okr.guid099855207052233298
okr.identifier.doi10.1596/1813-9450-10119
okr.identifier.externaldocumentum33862123
okr.identifier.internaldocumentum33862123
okr.identifier.reportWPS10119
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099855207052233298/pdf/IDU0158ecaac01be104fd80a04a03c9cf1992a74.pdfen
okr.region.geographicalWorld
okr.topicPrivate Sector Development::Microenterprises
okr.topicGovernance::Political Systems and Analysis
okr.unitDevelopment Economics, Global Indicators Group
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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