Corporate Campaign Contributions as a Predictor for Abnormal Stock Returns After Presidential Elections

25 Pages Posted: 15 Apr 2008

See all articles by Juergen Huber

Juergen Huber

University of Innsbruck; University of Vienna - Department of Finance

Michael Kirchler

University of Innsbruck

Date Written: April 15, 2008

Abstract

In the U.S. campaign contributions by companies play a major role in financing election campaigns. We analyze contributions by companies before an election and stock market performance after the election for the presidential elections from 1992 until 2004. We find that (i) the percentage of contributions given to the winner in a presidential election and (ii) the total contribution (divided by market capitalization) have a significant positive impact on a company's stock market performance after an election. While under Clinton both factors were equally important, during the Bush-presidency the total contribution had comparatively more impact.

Keywords: Presidential Election, Corporate Campaign Contribution, Abnormal Returns

JEL Classification: D72, G10, P16

Suggested Citation

Huber, Juergen and Kirchler, Michael, Corporate Campaign Contributions as a Predictor for Abnormal Stock Returns After Presidential Elections (April 15, 2008). Available at SSRN: https://ssrn.com/abstract=1120829 or http://dx.doi.org/10.2139/ssrn.1120829

Juergen Huber (Contact Author)

University of Innsbruck ( email )

Universitätsstraße 15
Innsbruck, Innsbruck 6020
Austria

University of Vienna - Department of Finance ( email )

Bruenner Strasse 72
Vienna, 1210
Austria

Michael Kirchler

University of Innsbruck ( email )

Universitätsstraße 15
Innsbruck, Innsbruck 6020
Austria

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