Abstract

http://ssrn.com/abstract=2153378
 


 



Social Media and Corruption


Ruben Enikolopov


Institute for Political Economy and Governance; Universitat Pompeu Fabra; New Economic School

Maria Petrova


Institute for Political Economy and Governance, Barcelona; Universitat Pompeu Fabra; Barcelona Graduate School of Economics (Barcelona GSE); New Economic School (NES)

Konstantin Sonin


Higher School of Economics; Centre for Economic Policy Research (CEPR)

July 3, 2014


Abstract:     
Traditional mass media provide an important mechanism of fostering political and corporate accountability. In this paper we provide evidence that online social media can serve as an additional tool that promotes accountability. We study consequences of blog posts about corruption in Russian state-controlled companies. We show that the blog posts have a negative effect on stock returns of these companies, using five-minute, daily, or monthly data. This impact, however, becomes less pronounced or even positive for the posts that attract the most attention, which is consistent with the disciplining effect of social media. We also find that blog posts are associated with an increase in corporate accountability as evidenced by higher management turnover and less corporate conflicts. To confirm that the results are not driven by unobserved heterogeneity, we use incidents of distributed denial-of-service (DDoS) attacks on other blogs.

Number of Pages in PDF File: 59

Keywords: political economy, social media, accountability, governance

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Date posted: September 27, 2012 ; Last revised: August 22, 2014

Suggested Citation

Enikolopov, Ruben and Petrova, Maria and Sonin, Konstantin, Social Media and Corruption (July 3, 2014). Available at SSRN: http://ssrn.com/abstract=2153378 or http://dx.doi.org/10.2139/ssrn.2153378

Contact Information

Ruben Enikolopov
Institute for Political Economy and Governance ( email )
Ramon Trias Fargas, 25-27
Barcelona, 08005
Spain
Universitat Pompeu Fabra ( email )
Ramon Trias Fargas, 25-27
Barcelona, E-08005
Spain
New Economic School ( email )
47 Nakhimovsky Prospekt
Moscow, 117418
Russia
Maria Petrova (Contact Author)
Institute for Political Economy and Governance, Barcelona ( email )
Ramon Trias Fargas, 25-27
Barcelona, 08005
Spain
Universitat Pompeu Fabra ( email )
Ramon Trias Fargas, 25-27
Barcelona, E-08005
Spain
Barcelona Graduate School of Economics (Barcelona GSE) ( email )
Ramon Trias Fargas, 25-27
Barcelona, Barcelona 08005
Spain
New Economic School (NES) ( email )
47 Nakhimovsky Prospekt
Moscow, 117418
Russia
Konstantin Sonin
Higher School of Economics ( email )
20 Myasnitskaya street
Moscow, 119017
Russia

Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
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