"From K Street to Wall Street: Politically Connected Analysts and Stock Recommendations" Free Download

DANE M. CHRISTENSEN, Pennsylvania State University
MICHAEL B. MIKHAIL, University of Illinois at Chicago - College of Business Administration
BEVERLY R. WALTHER, Northwestern University - Department of Accounting Information & Management
LAURA WELLMAN, Arizona State University (ASU) - W.P. Carey School of Business

In this study, we examine whether sell-side security analysts gain inside information from political connections. We measure analysts’ political connections based on political contributions at the brokerage house level. We argue that to the extent brokerages invest in political connections to obtain private information, analysts at politically connected brokerages are more likely to cover firms in general, and especially firms for which this information is more valuable. We use how sensitive the firm is to policy changes (as proxied by their lobbying expenses) to identify situations where this political information is even more valuable. We also predict that analysts at politically connected brokerages issue more profitable stock recommendations. This increased profitability should be more pronounced for politically sensitive stocks. Our evidence is consistent with these predictions. To provide further support, we document that the increased profitability of stock recommendations issued by politically connected brokerages is concentrated when there is high economic policy uncertainty. We also find some evidence that this increased profitability only exists during the times when Congress is in session. Collectively, these results suggest that brokerage houses obtain value-relevant, non-public information from their political connections.

"Проблема Тран?формации: Ошибочные ?ргументы Туган-Баранов?кого, Борткевича и Стидмена (The Transformation Problem: Erroneous Arguments of Tugan Baranowsky, Bortkiewicz and Steedman)" Free Download

V. V. KALYUZHNYI, Independent

Russian Abstract: В ?татье анализируют?? ошибочные аргументы Туган-Баранов?кого, Борткевича и Стидмена, которые до ?их пор и?пользуют?? критиками теории тран?формации товарных ?тоимо?тей в цены производ?тва, изложенной Марк?ом в ІІІ томе «Капитала». Предложены методы первоначальной и окончательной тран?формации ?тоимо?тей в цены производ?тва, ?оответ?твующие теории Марк?а и подтверждающие ее обо?нованно?ть.

English Abstract: This paper analyzes erroneous arguments of Tugan Baranowsky, Bortkiewicz and Steedman which are still used by the critics of the theory of commodity values transformation into production prices, described by Marx in Volume III of "Capital". The methods of the initial and final transformation of values into production prices are proposed, which correspond to Marx theory and confirm validity of his arguments.


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