Corporate Lobbying and Financial Performance
University of Colorado at Boulder
David C. Parsley
Vanderbilt University - Owen Graduate School of Management; Vanderbilt University
Wake Forest University
November 23, 2012
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.
Number of Pages in PDF File: 43
Keywords: Corporate Lobbying, political strategy, market returns, portfolio
JEL Classification: G3, G14, G18working papers series
Date posted: September 13, 2007 ; Last revised: December 4, 2012
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